Bangladesh Bank Training Academy Journal

Abstract

The objective of the paper is to analyze the external sector performance in Bangladesh, especially export earnings and inflow of remittances. The main findings of this paper reveal that export earnings and remittances are the dominating external sector factors of Bangladesh economy for decades although, both remittance and migration growth decreased lately. Remittance inflows from different destination have also changed over the period. On the other hand, migration from Bangladesh is concentrated in a few destinations which may generate serious problem if any external shock creates from those destinations. However, the decreasing rate of remittance and outward migration might create severe problem in the economy by reducing employment opportunities and output level. Conversely, export growth has underperformed over the few years.Commodity exports show that Bangladesh is predominantly a manufactured goods exporting country and Bangladesh's export basket is concentrated in a few commodites. In addition, export earnings from Bangladesh are centered in a few destinations. Any fluctuations of the export demand from these regions might seriously affect the external balance of the country as well as expected level of growth. The decreasing rate of remittance and export earnings is a concern for the overall economy as well as for the policy-makers regarding the external sector.