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Course Name: Intro. To International
Business
Student’s Name:
Course Code: MGT-321
Student’s ID Number:
Semester: Second
CRN:23468
Academic Year:2021-22-2
nd
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Economic Development in Bangladesh
Question 1
The effects of colonization on nations' economic development are usually rampant as
countries try to grapple with life following independence. Bangladesh gained independence from
Pakistan in 1971. It was not an easy affair since they had to go through a brutal civil war that left
many people dead. Essentially, many principal reasons triggered the economic stagnation of
Bangladesh after its war for independence. One of them was the lack of sufficient natural
resources. While this aspect made its economic progress derail, the country was still grappling
with poor infrastructure, political instability, and high incidences of corruption. Another
principle reason for the economic stagnation in this country is its high propensity to natural
disasters. For a long time, the country has suffered from tropical cyclones, floods, and tidal bores
destroying property, infrastructure and leading to loss of lives. This environment contributes to
economic stagnation as investors shy away from an unfriendly business atmosphere. In this case,
it is evident that Bangladesh has lagged behind in economic progress because of the natural
disasters combined with poor infrastructure, political instability, and high levels of corruption.
Question 2
The liberalization program in the 1990s enabled Bangladesh to start elevating its
economy in various ways. It was a perfect opportunity for the nation after undergoing a severe
struggle since its independence. This liberalization enabled the country to climb the ladder of
economic progress by adopting socialist policies (Hossain, 2013). In so doing, people could do
business freely without the influence of external factors, especially those that emanate from
politics. Apart from that, liberalization helped the country nationalize many firms and subsidize
agricultural production costs. This strategy allowed the nation to improve economically since the
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citizens could easily afford basic food products and agricultural companies started to thrive. The
liberalization program also made the currency convertible and reduced import duties to lower
levels. Such an approach lowered local and international investors' costs of doing business. The
government combined this move with the removal of most controls on the movement of foreign
private capital. In this case, investors could easily import goods and services. The program
helped eradicate poverty as the country saw a reduction of the poverty level from 45 percent to
17.5 percent.
Question 3
Since gaining its independence, Bangladesh has depended on agriculture and textile
products. Depending on those two main areas has a lot of risks bearing in mind the current
economy requires diversification of the highest level due to uncertainty. The primary risk for
focusing too much on agriculture and textile products is that other areas will receive no attention
(Kahan, & Food and Agriculture Organization of the United Nations 2013). For the Bangladesh
case, focusing too much on these two areas will make the country fail to concentrate on other
important sectors such as infrastructure, corruption, and the political system. The main risk
associated with the sale of textiles as the primary source of livelihood is the disruptions of the
economy. The textile export environment is prone to unexpected alterations due to factors such
as changing customer preferences and technological advancement. On the same note,
dependency on these two sectors faces the risk of competition from the already established
economies such as China, Turkey, Vietnam, and India. For Bangladesh to diversify its industrial
and commercial base, the government ought to exploit new markets and expand regional trading
opportunities. There is also a need to invest in new products while building a supportive
environment for local and international businesses.
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References
Hossain, M. I. (2013). Economic liberalization reforms may explain the impressive GDP growth
in Bangladesh. Journal of Asia Pacific Studies, 32, 1-
13. https://www.apu.ac.jp/rcaps/uploads/fckeditor/publications/journal/RJAPS32-9-
Hossain.pdf
Kahan, D., & Food and Agriculture Organization of the United Nations. (2013). Managing risk
in farming. Rome, Italy: Food and Agriculture Organization of the United Nations.

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