Bangladesh is probably one of the last places in Asia you would expect to see a thriving beachside resort featuring luxury hotels.
The transformation of Cox’s Bazar from remote backwater to beach El Dorado— Bangladesh-style— encapsulates the changes that have taken place in this nation, and many other developing Asian countries, over the past decade or two.
And yet, Cox’s Bazar is exactly that— a place where affluent Bangladeshis go for a weekend of well-behaved, fully clad fun by the seaside. Come here during the high season, when the monsoon rains are not pounding the country, and you will find the beach filled with children and their watchful parents and with slightly dilapidated orange beach umbrellas.
About five years ago, there were only two or three high-end hotels in this small town on the Bay of Bengal. Now there are a dozen, and counting. Smaller hotels and guesthouses are proliferating, and property prices have risen sharply.
The transformation of Cox’s Bazar from remote backwater to beach El Dorado— Bangladesh-style— encapsulates the changes that have taken place in this nation of 160 million people, and many other developing Asian countries, over the past decade or two.
“A middle class is gradually forming,” said Zahid Hossain, principal economist at the Asian Development Bank in Dhaka, the capital of Bangladesh. It mirrors the developments that other emerging economies have been going through, he said. “Domestic demand is growing and becoming an important driver of economic activity.”
Progress, of course, has been uneven. As in other Asian countries, the gap between rich and poor has widened in Bangladesh, giving rise to social tensions and sometimes violent protests. The murder this month of Aminul Islam, a prominent labor rights activist, apparently in retaliation for his advocacy work, put a spotlight on the low wages and poor working conditions that prevail in burgeoning sectors like the garment industry.
In Bangladesh’s countryside, home to more than 70 percent of the population, subsistence farming remains the norm, and weather-related disasters regularly wreak havoc in the pancake-flat lowlands.
Foreign direct investment in Bangladesh has languished at about $1 billion a year— less than what Albania or Belarus each receive, and about one-tenth of foreign investments in Thailand or Malaysia. Woefully inadequate power and transportation infrastructures, political infighting, bureaucracy, corruption and a shortage of skilled laborers contribute to a challenging investment climate.
Yet despite this, the Bangladeshi economy has managed to grow more than 6 percent a year for much of the past decade.
Economists at Standard Chartered believe that Bangladesh could join what it has dubbed the “7 percent club” of economies that expand at least 7 percent annually for an extended period— allowing their economies to double every decade. Current members of the “club” include China, Cambodia, India, Mozambique and Uganda.
HSBC, meanwhile, included Bangladesh in a group of 26 economies— along with China, India and several Latin American and African countries— where it expects to see particularly strong growth. The United States and much of Europe, by contrast, are likely to remain merely stable, according to HSBC's projections.