Bangladesh’s Journey to Middle-Income Status : The Role of The Private Sector

The report is organized as follows. Section one introduces the country context, section two provides a historical context and reviews the public policies that have affected the private sector, including macroeconomic management and trade policy. It explains how Bangladesh got to where it is. Section three examines the historical rise of Bangladeshi private entrepreneurs and current role, Section four describes their success in overcoming constraints. Section five provides the unfinished agenda, especially in terms of the reforms needed to accelerate private investment and the priorities identified through the survey evidence. Relying on a review of the policy environment, in-person interviews at leading firms and conglomerates in garments, steel, logistics services, pharmaceuticals, footwear, and services, and a short online survey among more than 100 companies, the study explores the factors of success, including the role of public policy. The ten case studies in the report, drawn from the successful tail of the distribution, show how some firms in Bangladesh overcame seemingly insurmountable odds. Without technical knowledge, complex equipment, easy logistics and supply chains, or bank financing, the firms achieved strong outcomes. The report also looks at factors that have prevented firms from continuing to expand and assesses the unfurnished reform agenda in terms of doing business and improving competitiveness. The report ends by listing key lessons of the Bangladeshi success that can be replicated in other low-income countries and fragile and conflict-affected states.