World Bank warns of 600,000 job losses in Bangladesh

The World Bank has warned that Bangladesh faces a risk of 600,000 job losses and an increase in poverty due to the economic fallout from conflicts in the Middle East. The crisis is manifesting through rising fuel prices, gas shortages disrupting industrial production, and reduced fertilizer supplies, which collectively impact transportation, agriculture, and consumer prices.

According to the World Bank's mid-June assessment, the conflict has significantly hindered poverty reduction efforts. While approximately 17 million people were expected to escape poverty by 2026 under stable conditions, that number may drop to just 5 million due to the current instability. This represents a potential loss of opportunity for 12 million people to move out of poverty.

The report highlights that inflation will play a major role, contributing roughly 10 percent to the increase in poverty this year. Rising energy costs are expected to trigger a chain reaction, increasing expenses for electricity, manufacturing, and transport, ultimately driving up food prices. This pressure is predicted to disproportionately affect low-income populations and widen the wealth gap.

Bangladesh's economy is already under strain from high inflation, a weak banking sector, and limited government spending. The country's heavy reliance on imported energy, particularly Liquefied Natural Gas (LNG), exacerbates its vulnerability to global price fluctuations.