Relationship between key export industry and balance of payment and exchange rate of selected country (case study)

Bc. Jabed Mahmud, BBA

Master's thesis

Abstract:

This diploma thesis explores the current relationship between exchange rates, inflation, foreign direct investment (FDI), and the export performance of Bangladesh's garment industry. The study reveals key insights into the dynamics driving the nation's economic development and its emergence as a pivotal center for global garment manufacturing. Findings indicate that exchange rate movements significantly impact garment exports, with a 1-unit depreciation of the domestic currency against the US dollar correlating with a 3.57 percent export increase. Inflation's adverse effects are evident, with a 1 percentage point increase leading to a 0.14 percent decrease in exports. Moreover, FDI inflows positively influence garment exports, with a $1 billion increase resulting in a 0.186 percent export rise. Policy implications include advocating for exchange rate stability, maintaining price stability, and attracting FDI to sustain industry growth. Overall, this research underscores Bangladesh's potential as a manufacturing hub and the importance of proactive policymaking to harness this potential.

Keywords

garments, exports, Bangladesh

Jazyk práce: English

Datum vytvoření / odevzdání či podání práce: 30. 3. 2024

Obhajoba závěrečné práce

• Obhajoba proběhla 29. 5. 2024
• Vedúci: prof. Ing. Mansoor Maitah, Ph.D. Ph.D.
• Oponent: Jana Skřivánková, B.E., externi

Czech University of Life Sciences Prague

Faculty of Economics and Management

Master programme:
Economics and Management