August 9, 2007 / 7:35 AM / 11 years ago

Floods to slow Bangladesh econ growth - World Bank

A view of makeshift houses at Mohammadpur in Dhaka August 9, 2007. Bangladesh's economic growth may slow to 6.8 percent from a target of 7 percent in the current fiscal year to June 2008 due to floods, while inflation and the budget deficit may go up, the World Bank said late on Wednesday. REUTERS/Rafiqur Rahman

DHAKA (Reuters) - Bangladesh’s economic growth may slow to 6.8 percent from a target of 7 percent in the current fiscal year to June 2008 due to floods, while inflation and the budget deficit may go up, the World Bank said late on Wednesday.

“Growth in export earnings will fall against a rise in imports, though remittances are likely to increase,” said the World Bank at a meeting between the government and development partners.

It trimmed agriculture sector growth by 0.2 percentage point to 4.0 percent, industrial sector growth by the same margin to 8.3 percent and services sector growth to 6.7 percent, from a previously estimated 6.8 percent.

“The budget deficit will widen due to an increase in unforeseen expenditure and decline in revenue collection,” the Bank said.

“Inflation will rise further in next couple of months, while food prices in particular remain the biggest concern.”

Annual inflation rose to 9.2 percent in June, according to the Bangladesh Bureau of Statistics.

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