EC Country Strategy Paper for Bangladesh 2002-2006

cruitment into public jobs, illegal campaign financing and other forms of using state funds
for private or party benefits. In the economy, bribery, kickbacks, speed-money and other
criminal activities negatively impact on the allocation of resources and the level of overall
investment in the country. Obviously, the scope of corruption increases also transaction
costs of business and creates distortions within the market.
On the positive side, civil society in Bangladesh has flourished in the past ten years of return
to a democratic political system. Expression of this are over 1,800 registered nongovernmental
organisations (NGOs), and a multitude of unregistered community based organisations
(CBO). National women organisations claim that almost every village has its
women’s group, while micro-credit organisations have established ten thousands of village
groups or organisations throughout the country.
A pronounced government policy for the improvement of the status of women, together
with an active NGO sector, have contributed to redressing some gender imbalances over the
past decade, in the face of an increasing activism by Muslim fundamentalist groups.
Women have increased their economic status and become a political force. Nonetheless,
extreme poverty is still predominantly female and malnutrition is highest among women.
Bangladesh has also many environmental problems, which threaten to make poverty alleviation
even more difficult. These include frequent natural disasters, urbanisation and industrial
pollution, deforestation and desertification, changes in climatic conditions, salinity,
and an overall deterioration of the habitat of flora and fauna. Excessive water extraction for
irrigation purposes lowers the ground-water level, flood control measures block migration
paths of fish stock, and extensive shrimp cultivation destroys arable land. Improvements in
the supply of the population with safe drinking water are seriously imperilled by the discovery
of widespread arsenic contamination of the ground water which leads to arsenic poisoning
of the population in whole regions of Bangladesh.
V. Medium-Term Challenges of Bangladesh
From the above, the challenges facing Bangladesh in achieving the international development
goals by 2015 are enormous. The “Bangladesh 2020 Study” (see table 3 Annex 1)
summarises these challenges as follows:
• To graduate approximately 40 million people from poverty by 2015;
• To absorb at least 20 million people in every decade into the labour force;
• To achieve a GDP growth rate of above 7% in order to make an effective contribution
to Poverty reduction (against a current average of 5%);
• To reduce the total fertility rate to 2.1 at the earliest possible time in order to reach a net
replacement level of the population and limit the impact on the ‘carrying capacity’;
• To significantly raise life expectancy beyond 60 years by reducing maternal and child
mortality rates from the current high levels;
• To raise the level of literacy;
• To accommodate an urban population of approximately 70 million people by 2020,
(compared with only 30 million today).
To take up these challenges, Bangladesh has urgently to address the following bottlenecks:
• Allocate significant investments in improving infrastructure, both for the internal market
as well as export. Transport and utilities will need to be able to cope with the increasing
demand from both industry and consumers;
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