Dhaka Bureau: A mission of the International Monetary Fund (IMF) is coming to Dhaka on September 6 on a 15-day visit. It is said that the IMF is coming on this mission to analyze the fiscal risk, including the macroeconomic risk, of Bangladesh. At this time, Bangladesh’s debt management strategies, recent and expected trends in external non-concessional borrowing data, and the risk of government debt will be reviewed.
According to the finance department, the technical assistance (TA) mission visit of the organization has nothing to do with the condition of getting a loan of 4.7 billion dollars from the IMF. This is a regular mission. According to the information, Bangladesh expects to receive the second tranche of the loan from the IMF next December. Before this, the review mission will come on October 4 to verify the implementation of the loan conditions.
During its stay in Bangladesh from September 6 to September 19, the TA mission of the IMF will hold a series of meetings with the Ministry of Finance, the Prime Minister’s Office, and the relevant ministries and departments. At this time, the mission will discuss the risks identified in the macroeconomic risk analysis, debt sustainability analysis, and macroeconomic and fiscal outlook of Bangladesh in the Medium-Term Macroeconomic Policy Statement (MTMPS).
The finance department has started preparing for the upcoming visit of the IMF mission. The macroeconomic division of the finance department has asked to nominate the focal point officer by writing to the concerned ministry last Monday for necessary information and assistance. On the first two days of the visit, the IMF will hold meetings with officials from various wings of the finance department. In this, the legal and institutional setting of fiscal risk management in Bangladesh and the situation of state-owned enterprises will be discussed.
Finance department officials said the IMF would like to know a lot of information about state-owned enterprises (SOES). For example, the governance framework of state-owned enterprises, their control and financial oversights, public service obligations of SOES, financial support, and track record of debt service payment obligations will be discussed. They said that the IMF will also review whether any fiscal risk is being created in Bangladesh through the Public-Private Partnership (PPP) project.
The mission will analyze PPP-related firms and contingent liabilities. Besides, the IMF team will analyze the management of government guarantees and loans to state-owned enterprises. In this, it will review the current stock of guarantees, beneficiaries, outstanding guarantees, servicing of guaranteed debt, and the target amount of guarantees in the next 3 financial years. Further, the risk will be assessed by verifying that there is any provision in the budget for guaranteed debt servicing. At the same time, the IMF will examine the debt, stock of debt, pricing, recovery, and projected debt service data of the state-owned enterprises and other institutions of the government for the next 3 years.
During the visit, the IMF will also analyze what kind of risks are being created in Bangladesh’s macroeconomics and fiscal management due to natural disasters and climate change. The IMF will analyze the negative impact of natural disasters on the country’s economy, the impact of natural disasters on revenue collection, and how much financial assistance the government has to provide from the budget to deal with disasters.
