Bangladesh’s cottage, micro, small, and medium enterprises (CMSMEs), which generate 85% of employment in the informal sector, face a production downturn, affecting job creation and the larger economy. Official data on November 23, 2024, revealed a decline in CMSME production growth, with FY 2023-24 recording only 5.07%, down from 15.39% in FY 2021-22 and 9.03% in FY 2022-23. Cottage industry growth also fell to 6.7% in FY24, compared to 7.67% and 9.96% in previous years. The steepest decline was in machinery and equipment production, which saw a 45.55% negative growth in FY24. Economists attribute this to declining real wages, reduced purchasing power, and inflation.
Experts urge formalizing CMSMEs, stabilizing power and gas supplies, expanding market access, and controlling inflation to revitalize these sectors. They warn that continued decline risks shrinking employment opportunities, pushing more people below the poverty line, and undermining Bangladesh’s economic resilience.
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