The Crime Desk: The International Monetary Fund (IMF) has said that the weakness of Bangladesh’s financial sector has become more visible and pronounced. While the government’s demand for increased spending has increased, revenue has decreased. Arrears status has increased for payment of dues to the government. Which has put pressure on the economy. In this situation, the IMF is keen to advance the reform program. At the same time, they have also promised to help Bangladesh in an increased capacity.
These things were said in a statement of the IMF mission visiting Dhaka on Monday. The IMF mission arrived in Dhaka on September 24 to discuss the evaluation of the IMF’s ongoing loan program, the progress in implementing conditions for the next installment of the loan waiver, and the extension of assistance as requested by Bangladesh. Their mission ended on Monday. At that time they were finance and trade advisers. Salehuddin Ahmed, Governor of Bangladesh Bank. Ahsan H. Mansoor discussed the overall situation in Bangladesh at various levels, including private sector research institutes. They had a long meeting with the central bank on Monday.
At the end of the mission, its chief IMF official Chris Papageorgiou said in a statement on Monday, “We are deeply saddened by the loss of life and injuries in the recent uprising and express our solidarity with the people of Bangladesh at this difficult time. The interim government that took over after the coup took steps to stabilize the political and security situation. Which has helped the economy of Bangladesh to gradually return to normal.
The statement further said that economic activity has slowed down significantly despite various reformist measures undertaken by the interim government. In the recent post-new government period, some disturbances and major floods have disrupted economic activities and caused considerable damage. The inflation rate is now in double digits. External balance is still in deficit due to external debt repayment pressure. This has created additional pressure on foreign exchange reserves. At the same time, the recent economic slowdown has reduced revenue collection. Revenues have fallen at a time when demand for increased government spending has increased. At the same time, the pressure of payment of arrears from internal sources has also increased.
The financial sector’s weakness has become more pronounced in recent times, the statement said. At the same time, it is getting intense. In this context, the government and IMF staff have had frank and fruitful discussions on the policies and reforms needed to address these new and earlier challenges. To deal with this challenging situation, the government needs to continue to adopt more stringent policies in the financial sector. At the same time, expenditure should be reduced in non-essential sectors. The IMF is supporting initiatives to initiate policy coordination, including rationalization of government revenue and expenditure policies.
In the statement, he added,The IMF remains a steadfast partner in supporting Bangladesh’s development activities. The IMF is committed to supporting the process of conducting operations in the interest of Bangladesh and its people. The agency is committed to continuing to work closely with the government to advance its activities in Bangladesh within the framework of ongoing IMF-supported programs. It aims to ensure macroeconomic stability, create jobs, strengthen institutions, and continue to work towards strong, sustainable, and equitable growth. Welcoming the government’s new commitment to implement reform programs under the IMF’s loan program, the IMF said more details will be discussed during the upcoming IMF Annual General Meeting.
Meanwhile, the delegation of the International Monetary Fund (IMF) staff mission visiting Dhaka discussed monetary policy, inflation, the dollar market, reserve management, the international transaction (BOP) system, revenue reform, and the and the bank liquidity situation in the meeting held from September 24 to 30 with Bangladesh Bank and all related institutions of the government. It held phased meetings on 47 issues, including defaulted loans and subsidies on the import of energy products. In the meeting, the proposals included as conditions for the company’s $4.7 billion loan were analyzed in detail. But the IMF has taken a positive stance on almost everything except a handful of conditions. An official of Bangladesh Bank, who participated in the meeting, said on condition of anonymity that the IMF has said that about 40 of the 47 conditions have been met or are on the way to be met. That’s why they are fairly positive about the previous $4.7 billion (4.7 billion) loan along with the newly sought $3 billion (3 billion) loan. And since the governor is not in the country, nothing about the loan was officially announced in the rap-up meeting. However, the mission delegation invited the governor to the IMF meeting held in the United States on October 22-24. There will be a final decision regarding the loan.
