Bangladesh : The Path to Middle-Income Status from an Urban Perspective

"Bangladesh seeks to attain middle-income status by 2021, the 50th anniversary of its independence. To accelerate growth enough to do so, Bangladesh needs to build a competitive urban space that is innovative, connected and livable. Bangladesh's urban areas have to take proactive measures to improve and sustain all three drivers of competitiveness - innovation, connectivity and livability. The results of a survey of 1,000 garment firms -- conducted to provide a lens through which to investigate urban competitiveness -- reveal that Dhaka City is the most productive location for garment firms in Bangladesh. It is falling behind in accessibility and livability because of high congestion and severe constraints in land and housing markets, however. And it needs to gain a competitive edge in higher value-added products and services. Peri-urban areas of Dhaka are emerging as competitive manufacturing centers, but they suffer from Dhaka City's congestion and have less access to infrastructure. Chittagong City has failed to capitalize on its comparative advantage as the country's largest seaport city. Strategically located export processing zones are higher-productivity, higher-cost locations that are partially shielded from the inefficiencies of urban areas. Medium-size and small cities are uncompetitive 'distant places', which need to foster local entrepreneurship to find their comparative advantages. Strengthening competitiveness across Bangladesh's cities calls for coordinated and multipronged interventions encompassing infrastructure, institutions, and incentives to transform Dhaka into a globally competitive metropolitan region, leverage Chittagong City's natural comparative advantage as a port city, promote strategically located export processing zones to foster industry competitiveness and spearhead urban reforms, and create the enabling environment for local economic development in medium-size and small cities."-- Provided by publisher By 2021, the 50th anniversary of its independence, Bangladesh seeks to attain middle-income status. To accelerate growth enough to do so, Bangladesh needs to build a competitive urban space that is innovative, connected, and livable. Bangladesh: The Path to Middle-Income Status from an Urban Perspective investigates the drivers and obstacles to creating a competitive urban space by focusing on one of the country’s most successful industries: the garment sector. In analyzing a survey of 1,000 garment firms, this study reveals that Bangladesh’s urban areas are falling behind in all the three drivers of competitiveness †“ innovation, connectivity and livability. Dhaka City, its capital, is the country’s most productive location for garment firms. Yet, it is falling behind in accessibility and livability because of high congestion and severe constraints in its land and housing markets. And Dhaka City currently lacks the economic diversity that is expected in a metropolitan area of its size. Emerging manufacturing centers in the surrounding peri-urban areas suffer from Dhaka City’s congestion and their own low access to infrastructure. Chittagong City has failed to capitalize on its comparative advantage as the country’s largest seaport. And Bangladesh’s small- and medium-size cities remain uncompetitive “distant places,†? lacking the environment needed to foster local entrepreneurship. To meet its goal of reaching middle-income status by 2021, Bangladesh will need to transform Dhaka into a globally-competitive metropolitan region, leverage Chittagong City’s seaport advantage, promote strategically located export-processing zones, and enable local economic development in small- and medium-size cities. Bangladesh: The Path to Middle-Income Status from an Urban Perspective aims to foster timely policy dialogue among decision makers in the government, private sector, and civil society on the policy directions that will enhance the growth and sustainable development of Bangladesh’s cities.

Bangladesh seeks to attain middle-income status by 2021, the 50th anniversary of its independence. To accelerate growth enough to do so, it will need to undergo a structural transformation that will change the geography of economic production and urbanization. Critical to its transformation will be the creation of a globally competitive urban space, defined here as a space that has the capacity to innovate, is well connected internally and to external markets, and is livable (Organization for Economic Cooperation and Development, or OECD 2006; World Bank 2010). This study identifies what is unique about Bangladesh s process of urbanization and examines the implications for economic growth. Through the lens of Bangladesh s most successful industry, the garment sector, it describes the drivers of and constraints to urban competitiveness. Based on the findings, it provides policy directions to strengthen the competitiveness of Bangladesh s urban space in ways that will allow Bangladesh to reach middle-income status by 2021.

Bangladesh seeks to attain middle-income status by 2021, the 50th anniversary of its independence. To accelerate growth enough to do so, Bangladesh needs to build a competitive urban space that is innovative, connected and liveable. Bangladesh's urban areas have to take proactive measures to improve and sustain all three drivers of competitiveness - innovation, connectivity and liveability.