Last May, Bangladesh launched its first national satellite into space on a rocket provided by Elon Musk’s space firm SpaceX. The launch serves as both a symbolic and practical achievement for Prime Minister Sheikh Hasina’s government, demonstrating Bangladesh’s development under her administration and vastly improving Bangladesh’s telecommunications and internet services. This was just one of Bangladesh’s many moves toward modernization and self-sufficiency. Just a few days ago, Sheikh Hasina met with Russian Deputy Prime Minister Yury Borisov to announce progress on Bangladesh’s first nuclear power plant.
These developments are nothing to scoff at for a country that achieved independence less than 50 years ago. Moreover, Bangladesh faced overwhelming obstacles to development at independence. Much of Bangladesh’s infrastructure had been destroyed in the 1971 war, its population suffered from chronic malnutrition, and it possessed the highest rural population density on Earth. To add insult to injury, in 1971, Henry Kissinger famously dismissed Bangladesh as a “basket case.”
In recent years, however, Bangladesh has overcome the odds and made strong economic and social progress. As such, the United States has much to gain from a stronger bilateral partnership.
A Historic Rise
By the early 2000s, Bangladesh was still being overlooked as a potential global economic player. It registered faster growth than Pakistan in 2006, but this was seen as a fluke.
Yet Bangladesh has ramped up economic development in the last decade. In 2016, Bangladesh’s economy grew by 7.1 percent, marking its fastest growth in 3 decades and its sixth straight year of GDP growth above 6 percent. Furthermore, since the turn of the century, Bangladesh’s primary school enrollment rate has risen from 80 to 99 percent. Poverty, too, has dropped dramatically, from over 40% in 1991 to under 14% today.
This growth can’t be attributed to any individual factor, although globalization likely played a role, connecting Bangladesh to investors across the world. Yet another unique feature of Bangladesh’s rise has been its empowerment of women. Bangladesh invests a lot in education for girls through stipends and scholarships; it is no wonder that more Bangladeshi girls than boys attend primary school and that the World Economic Forum ranked Bangladesh first in gender equality in South Asia. Another emblematic fun fact is that Bangladesh hasn’t had a male prime minister since 1990.
Of course, Bangladesh is a low-income country that has much room to improve. Worker conditions are notoriously bad; one of the world’s worst industrial accidents occurred in 2013 when a factory collapsed, killing over 1,100 people. Additionally, Bangladesh continues to have one of the lowest minimum wages in the world, and the ruling Awami League party appears to be increasingly authoritarian.
That said, Bangladesh’s recent economic progress has been swift and impressive. In March, the UN Committee for Development Policy announced that Bangladesh had met the criteria to advance from a “least developed country” to a “developing country,” a distinction which carries a lot of significance. India, Mexico, and Turkey are also classified as developing countries.
One of the strongest indicators of overall welfare is life expectancy. As of 2016, Bangladeshis enjoyed a life expectancy of 72 years, while India and Pakistan had life expectancies of just 68 and 66 years, respectively.
Bangladesh and the United States
The American relationship with South Asia has concentrated heavily on India and Pakistan. The U.S. focused most of its attention on its alliance with Pakistan throughout the Cold War, despite Pakistan’s autocratic tendencies. Today, most Americans view India as the key regional trade partner due to its own massive growth. But even if Bangladesh often flies under the radar, its recent economic progress should qualify it as a promising American trade partner going into the future.
Unfortunately, Bangladesh pays the single highest tariffs on exports to the US of any country in the world. This is because 95% of Bangladesh’s exports to the US are clothing and other related items, which the U.S. tariffs heavily. Companies in Bangladesh paid tariffs equivalent to 15.2% of the value of their shipments to the US in 2017. These tariffs clearly impede the growth of the US-Bangladesh relationship and hurt both American and Bangladeshi citizens, as companies are forced to either increase prices or decrease wages.
Last Wednesday, US Ambassador to Bangladesh Marcia Bernicat spoke at the International Business Forum of Bangladesh in Dhaka, stressing the importance of lowering trade barriers. In her talk, she pinned most of the blame on Bangladesh’s own trade and investment barriers.
But given Bangladesh’s track record of economic success and its potential to be a strong U.S. trade partner, the American government would be wise heed her advice as well. Despite its faults and growing pains, Bangladesh is a country worth investing in.