Bangladesh can boost growth and climate resilience by investing in women

Bangladesh can boost growth and climate resilience by investing in women

By Jayendu De and Genet Zinabou

June 12, 2024

Significant gaps in women’s economic empowerment undermine growth and exacerbate climate vulnerability

Bangladesh has made great gains for its population, the eighth largest in the world with more than 170 million inhabitants. Per capita income, one of the best measures of broad economic well-being, has risen sevenfold in the past three decades, while poverty has been reduced to a fraction of previous levels. Such progress has been driven in part by greater labor force participation by women, particularly in the garment industry, and has been accompanied by other significant improvements in women’s empowerment.

Our latest analysis, however, shows that there are still large gaps between women and men. Notably, women’s labor force participation is only half that of men. Previous IMF research shows that closing this gap could increase the country’s economic output by nearly 40 percent. Women also remain less likely than men to obtain higher education, and they face greater barriers to accessing financial services. Correcting both factors can increase the productivity of the entire economy.

At the same time, efforts to close gender gaps face headwinds from Bangladesh’s extreme vulnerability to climate change and natural disasters. Like other economic shocks, climate shocks generally hit already poor and vulnerable people hardest. This means that Bangladeshi women, who on average have fewer resources than men, are likely to be disproportionately affected.

Our analysis further highlights several factors that make women in Bangladesh uniquely exposed to the effects of climate change and natural disasters:

• Women’s employment in Bangladesh is highly concentrated in agriculture and informal work. Climate change affects agricultural production very directly, while informal workers are often particularly vulnerable to climate shocks as they lack access to social security programs.
• International and internal migration are important climate adaptation strategies, which are mainly used by men. Bangladeshi men are 16 times more likely to be employed overseas than women, who tend to be primary care providers for children and the elderly, leaving them less mobile and more likely to live in highly exposed areas to climate change.
• Women in Bangladesh bear the primary responsibility for collecting drinking water and cooking fuel. As warming temperatures, rising sea levels, deforestation and more frequent cyclones and droughts make these tasks more time-consuming, women’s time poverty is expected to worsen.

Bangladesh has already recognized the need to mainstream gender perspectives in 2009 Climate Change Strategy. Following this, the government adopted the first climate change and gender action plan 2013, which it updated in March 2024. New efforts will be needed to ensure the successful implementation of the plan and to achieve simultaneous progress on climate action and gender equality. To this end, policymakers should capitalize as much as possible on the synergies between women’s empowerment, economic growth and increased resilience to climate change.

Policies that support women’s labor force participation deserve special attention, including those that expand their access to skills development and higher education, ease the burden of unpaid care by expanding affordable childcare, reduce informality, and address norms gender barriers that discourage women from seeking formal work and higher wages. .

Increased spending on health and education would help empower women by increasing labor productivity and making the entire population more resilient to climate change.

Persistent gaps between women and men in access to finance need to be addressed by instilling confidence in formal finance, strengthening women’s property rights and conducting financial education campaigns targeting women.

Bangladesh was an early adopter of gender responsive budgeting and has recently introduced climate budget labeling, a tool for tracking climate-related spending in the national budget. However, insufficient integration of gender and climate considerations during the initial strategic phase of budget formulation means that the system in Bangladesh currently functions largely as an ex-post accounting exercise. Improvements in this area combined with more systematic evaluation of the impact of government programs would enable more efficient channeling of public resources towards achieving gender equality and climate goals in the country.

Finally, women should not be thought of simply as beneficiaries of climate action. Rather, just as women played an integral role in the development of the garment industry and the success of Bangladesh’s growth in recent decades, they must be empowered to play an active role in the country’s green transition.

The IMF’s engagement with Bangladesh, including the country becoming the first in Asia to join our new Resilience and Resilience Trust, aims to support policy efforts in many of these areas.

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Jayendu De is the Permanent Representative of the IMF in Bangladesh. Genet Zinabou is an economist in the Department of Fiscal Affairs.