Welcome to Business Outlook
Related Articles
Economist Rehman Sobhan has called on Bangladesh to strengthen its private sector and adopt more agile, forward-looking policies to keep pace with the rapidly shifting global economy.
Speaking at the “Bay of Bengal Conversation,” organised by the Centre for Governance Studies (CGS) in Dhaka on Saturday, Sobhan warned that without strategic recalibration, Bangladesh risks falling behind as economic power moves decisively toward Asia.
“The world of 2025 is very different. Global economic power is moving to the Global South, especially South, Southeast, and East Asia,” he said.
He noted that China has already become the world’s largest economy in purchasing-power terms, with India rising quickly. By 2050, China, India and Indonesia are projected to sit among the world’s top four economies.
Sobhan identified three major forces driving this transformation: a realignment of global trade, new patterns of capital flows, and rapid technological advancement.
China, he said, has become the largest exporter and principal trading partner for many countries in Asia, Africa and Latin America, overtaking the long-standing dominance of the United States.
It has also emerged as the world’s biggest source of capital, providing US$2.1 trillion in loans and aid from 2000 to 2024, outpacing the US.
“China, Japan and other Asian economies now dominate global reserves and sovereign wealth funds,” he added.
Sobhan argued that Bangladesh must reassess its traditional dependence on Western markets.
At independence, Western donors supplied about 12% of the country’s GDP; today, aid dependence has fallen to about 2%, with roughly $50 billion in committed assistance still undisbursed, he said.
Meanwhile, much of Bangladesh’s new investment is coming from Asia, with China alone investing around $40 billion through loans and other financial instruments, the economist mentioned.
Despite this shift, Bangladesh continues to rely heavily on the US and Western markets for its ready-made garment exports and still leans on LDC-era trade preferences.
Sobhan warned that such dependence is risky, particularly given the unpredictability of US trade policy.
He also noted that Bangladesh has not fully capitalised on duty-free access to India since 2010 and has yet to position itself within regional supply chains anchored by China and India.
To succeed in the emerging global order, Sobhan said Bangladesh needs a private sector that is ambitious, outward-oriented and technologically capable.
Policymakers, he argued, must be more dynamic and strategic. He urged the country to shed what he described as the “LDC cocoon” and integrate itself into Asian-led value chains, where the fastest-growing markets, investments and technologies are concentrated.
“We are entering a new world order,” Sobhan concluded. “Bangladesh will need more creative policy-making and a more adventurous private sector to secure its place in the shifting global economy.”
(DS)
