The paper highlights certain inherent weaknesses of Bangladesh's economy as reflected in the low rates of savings, investment, and the growth of GDP, deceleration of industrial growth, the worsening revenue-GDP ratio that threatens the objectives of attaining greater self-reliance, acute financial sector crises afflicting the money and the capital markets, low and dwindling level of FDI, an unhealthy state of external sector imbalance and international reserves, and imprudent handling of international trade disputes. Despite strong policy pronouncements and commitments by Government to put the economy on the right track and stimulate the pace of economic growth, performance of the economy remains poor. Business environment is vitiated by inconsistent fiscal and monetary policies, lack of co-ordination among ministries and agencies responsible for policy implementation, bureaucratic sloth and hassle that delays decision making, deteriorating, law and order situation, poor physical and institutional infrastructure, energy crisis, etc., all of which discourage investment in productive activities and pose serious threats to the future growth of the economy. The paper discusses some of these problems,and recommends strong corrective measures in a wide range of areas that will be needed to arrest a further deterioration of the economic climate and for preparing the country to face the challenges of the intensely competitive world of the 21st century.