Socio-Economic Impact of COVID-19 and Policy Implications for Bangladesh

The COVID-19 pandemic is causing an unprecedented health and economic crisis for global economies, including Bangladesh. The impact of COVID-19 on the economy of Bangladesh has been transmitting through two main channels: (i) depressed domestic demand and supply disruptions in the local economy, and (ii) slowdown in global economic activities affecting global trade and international financial flows. This policy brief summarizes the main findings of a study by the BRAC Institute of Governance and Development (BIGD) that utilizes the Global Trade Analysis Project (GTAP) model—a multi-region/multi-country computable general equilibrium framework— to explore Coronavirus-induced disruptions for Bangladesh. It also explores the likely impact of the government’s stimulus package to mitigate the adverse consequences. The research concludes that boosting private demand should constitute a major policy target now as the economy starts to recover. Furthermore, this study also shows the potential of model-based analyses in deepening the understanding of the impacts of the COVID-19 pandemic and providing informed policy inputs.

Authors: Rahman, Sultan Hafeez; Razzaque, Abdur; Rahman, Jillur; Shadat, Wasel Bin
Type: Policy Brief
Year: 2020