The IMF expects Bangladesh’s growth to remain at around 7% over coming years, supported by exports, in particular clothing. Clothing exports make up almost 12% of Bangladesh’s GDP and 80% of all exports. Even in the face of increasing economic diversification, the garment sector continues to grow. However, the sector faces significant operational risks. The Rana Plaza factory collapse in 2013 highlighted the need for better safety standards, prompting the establishment of an accord among Western retailers and Bangladeshi factories to improve health and safety regulations. Factories have been investing in safety measures while remaining competitive. Bangladesh’s clothing industry remains competitive because of factors ranging from low labour costs to vertical integration and investment in technology and environmentally sustainable processes, which help raise efficiency and meet evolving consumer demand.
Bangladeshi income per capita exceeded US$1,900 in 2019—less than one-third of the regional average of US$5,925. But average incomes are forecast to surpass US$2,800 by 2024 as poverty rates decline. Less than 9% of the population lived in extreme poverty in 2018, compared to more than 40% in 1991. The poverty rate is projected to fall to less than 1% by 2025.