DHAKA, Apr 6 : A delegation from the International Monetary Fund (IMF) is to start discussions today with Dhaka and review updated financial data before releasing the pending fourth and fifth tranches of the $4.7 billion loan.
The team will visit various government officials over the course of its two-week visit, and engage with the Finance Division, National Board of Revenue (NBR), Power Division, Power Development Board, Bangladesh Energy Regulatory Commission (BERC), and the Energy and Mineral Resources Division, according to The Dhaka Tribune.
According to the Finance Division of Bangladesh’s Ministry of Finance, the team will meet with Finance Adviser Salehuddin Ahmed on both the first and last day of its visit.
So far, Bangladesh has already received three tranches since the loan program began on January 30, 2023, and got over $476.3 million in the first tranche on February 2, 2023, $681 million in the second tranche in December 2023, and $1.15 billion in the third tranche in June 2024.
In total, Bangladesh has received about $2.31 billion from these three tranches, leaving the fourth and fifth tranches, totalling $2.39 billion, still pending.
Meanwhile, in a pre-budget discussion with the Economic Reporters’ Forum (ERF), Finance Advisor Salehuddin Ahmed emphasised the importance of the IMF loan for budgetary support.
However, three key obstacles have been preventing Dhaka from receiving both instalments simultaneously: making the currency exchange rate market-based, raising additional revenue equal to 0.5% of GDP, and separating revenue administration from the NBR’s revenue policy.
With the ouster of the Sheikh Hasina-led Awami League government in August last year, Bangladesh has witnessed a massive socio-economic downfall, with recession in growth, and the resultant political instability under the army-backed Mohammed Yunus regime leading to many businesses and investors pulling out of the country.
The country was already suffering from the financial impact of the COVID 19 pandemic and struggling to get back to its original growth rate of 6-8%, with the current uncertainty under the interim government leading to a lot of problems.
Though there have been signs of some economic recovery, the national currency, the taka, has dropped sharply against the dollar, loans have started falling due to Bangladesh’s many emblematic megaprojects, the textile industry is witnessing a downfall, and parts of the banking sector look shaky.
(UNI)
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