Despite relaxed conditions for net reserves by the International Monetary Fund (IMF), Bangladesh could not meet the foreign exchange reserves target at the end of 2023. According to the IMF loan documents, the actual reserves were supposed to be USD $17.78 billion at the end of December 2023. However, as the year ended, the actual reserves stood at about $16.75 billion. Not much difference between political parties' views on energy situation: CPD Bangladesh Bank could not meet the reserves target as per IMF conditions by September-end as well. Later, the global lender reduced the reserves conservation target at the request of Bangladesh. Even the revised target could not be achieved by the end of December 2023. According to IMF's new conditions, the real reserves are expected to be $19.26 billion in March and $20.10 billion in June 2024. However, financial sector stakeholders cannot determine whether this goal will be achieved. The real reserve is the reserve that is calculated after excluding the SDR of the IMF, the dollars kept as foreign exchange clearing by the banks, and the dollars deposited for the Asian Clearing Union (ACU) bills. Apart from this, there are two other accounts of reserve. One of them is total reserve. Another IMF accounting system is reserves maintained under BPM6. At the end of the year 2023, total forex reserves increased to $27 billion. However, what the IMF considers is only net or real reserves. Md Mezbaul Haque, spokesperson and executive director of Bangladesh Bank told UNB that the central bank worked to keep the reserves above $17 billion, as per the IMF-set target. Former IMF economist Dr Ahsan H Mansur told UNB that it is unexpected that the IMF-set target could not be met even after reducing the previous target. Habiganj-2: JaPa candidate withdraws from election citing 'lack of fair environment' He also doubted that Bangladesh Bank will be able to maintain IMF’s foreign exchange reserves target in March 2024, if the central bank does not change its policies.

The International Monetary Fund (IMF) has relaxed several targets including foreign exchange reserves, revenue collection, automatic price adjustment of fuel for the $4.70 billion loan package for Bangladesh. At the beginning of this year, the IMF had set forex reserves target at $25.34 billion by September and $26.81 billion by June next year as conditions for the loan package. According to BPM6 – reserve calculation method – Bangladesh’s forex reserves stand at $21.15 billion. Bangladesh urged IMF to downsize required reserves to $20 billion for next loan instalment, says official On a net basis, this amount has further decreased to below $18 billion. In this situation, the Finance Division officials requested the IMF to relax the target for forex reserves. Considering the request, the IMF has relaxed the target. Bangladesh has committed to keep the reserves at $18.4 billion at the end of December this year, and at $20 billion at the end of June next year. IMF delegation meets BGMEA President to discuss challenges and prospects of RMG sector Last Tuesday and Wednesday, the visiting IMF delegation discussed the issues with the relevant officials of the Finance Division of the Ministry of Finance. Sources in the Finance Division said that after discussion, IMF agreed on being flexible on some conditions. Finance Secretary Md. Khairuzzaman Majumder led the meeting on behalf of the government. The IMF mission was led by Rahul Anand, head of the IMF’s Asia-Pacific division. IMF team holds meeting with Power Division, discusses subsidy

Bangladesh has now requested the International Monetary Fund to lower the requirement of foreign exchange reserves at $20 billion as a condition of releasing the second installment of the $4.7 billion loans, an official of Bangladesh Bank confirmed this on Monday (October 16, 2023). The request was made to the visiting IMF delegation that reviewed with the officials the progress in meeting its conditions. Read: Myanmar ambassador meets with FBCCI, keen to start direct flight Despite different measures taken by including cutting unnecessary and luxury goods imports, in the last three months, gross reserves declined by $2.58 billion. Two main sources of foreign exchange earnings –inward remittances flow saw a record decline to $1.34 billion in September and export earnings failed to achieve the target. Considering the situation the central bank proposed to the IMF mission led by Rahul Anand to revise the reserves down to $20 billion. Under the terms of the $4.7 billion IMF loan, the actual reserves were supposed to be maintained at $24.46 billion last June and $25.30 billion in September. At the end of December, Bangladesh must maintain at least $26.81 billion in net reserves. Read: PGCB, GIZ set up lab to advance country’s clean energy transition  The net forex reserves are now less than $18 billion, according to the calculations of Dr Zahid Hussain, a former lead economist of the World Bank's Dhaka office. However, the IMF also suggested that BB fix the exchange rate of US dollars on competitive market price, which is now being set by the Bangladesh Foreign Exchange Dealers’ Association (BAFEDA) in the concentration of the BB. The central bank earlier relaxed the exchange rate of the US dollar gradually and now the official exchange rate is Tk112 per dollar. Economist Dr Ahsan H Mansur said that Bangladesh has to maintain strict monitoring of trade-based money laundering along with cutting unnecessary imports to check the downslide. Read: IMF lowers growth forecast for current fiscal to 6 percent

Prime Minister Sheikh Hasina on Saturday (April 29, 2023) said that Bangladesh has taken a loan from the International Monetary Fund (IMF) as a "breathing space". The Prime Minister said this while an IMF delegation led by its Managing Director Kristalina Georgieva paid a courtesy call on her at the meeting room of The Ritz-Carlton hotel here. The IMF in January this year approved a loan of USD 4.7 billion for Bangladesh. Foreign Minister Dr AK Abdul Momen briefed reporters after the meeting. Also Read: PM Hasina arrives in Washington DC He said that the IMF MD highly praised the unprecedented advancement of Bangladesh in various sectors under the dynamic leadership of Sheikh Hasina which made the Bangladesh economy stable after the Covid-19 pandemic. The IMF chief also said leadership like the Bangladesh PM is necessary to take countries towards prosperity, confronting all hurdles, Momen told reporters. She said that Bangladesh has achieved remarkable progress due to massive infrastructure development, ensuring connectivity, and maintaining law and order. Bangladesh's Prime Minister briefed the IMF chief of her government’s initiatives to ensure the overall development of her country. Also Read: Extend more support for Rohingya: PM Hasina urges int’l community "The development of the country didn’t happen in a day, rather it’s the result of longtime planning and work," the PM was quoted as saying. She said that she prepared the plan on how she wanted to develop Bangladesh while she was in jail after a military-backed caretaker government assumed power in the political changeover of 2007, and started working with the plan after assuming power for the second time in 2009. Sheikh Hasina also mentioned various steps of the government to fight the adverse impacts of climate change and to ensure women’s empowerment.  Bangladesh Bank Governor Abdur Rouf Talukder said the IMF has always stood by Bangladesh over the last 14 years to maintain stability in the macro economy. Read More: Bangladesh likely to get back the money borrowed by Sri Lanka: FM He said that Bangladesh is currently engaged in a programme of USD 4.7 billion with IMF which the country got after only two weeks’ negotiation despite the fact that many countries cannot avail loan after negotiation for years. "The IMF will continue such cooperation in the future," Rouf said, quoting the IMF chief. He said that the Prime Minister hailed the role of IMF in the journey of Bangladesh's development and wished for continued support in future. Senior Secretary of Finance Division Fatima Yasmin and Economic Relations Division Secretary Sharifa Khan were present during the briefing. Read More: IMF loan program can be touchstone of financial sector reforms According to a statement of IMF in January, Bangladesh will get this $4.7 billion loan in seven installments over the next 42 months. The average interest on the loan will be 2.2 percent. Of the total amount, $3.3 billion will be available from the IMF’s ‘Enhanced Credit Support’ while $1.4 billion will come under the ‘Resilience and Sensibility Facility’. The IMF had said that the loan will help stabilise Bangladesh's macroeconomy, implement necessary reforms to build capacity for social and development spending, strengthen the financial sector, modernise policy frameworks and address climate change. The lending agency said that Bangladesh’s robust economic recovery from the pandemic has been interrupted by Russia’s war in Ukraine, leading to a sharp widening of Bangladesh’s current account deficit, depreciation of the taka and a decline in foreign exchange reserves. Read More: IMF-Bangladesh Bank meeting prioritizes unified exchange rate and competitive lending rate It further said that the authorities have taken on a comprehensive set of measures to deal with these latest economic disruptions. The authorities recognise that in addition to tackling these immediate challenges, long-standing structural issues and vulnerabilities related to climate change will also need to be addressed to accelerate growth, attract private investment, enhance productivity, and build climate resilience, the IMF statement clarified.

A team of the International Monetary Fund (IMF) is due to arrive in Dhaka on April 25 to discuss the progress in the use of the first tranche of its US$4.7 billion loan programme for Bangladesh and the release of the second installment. The Ministry of Finance sources told UNB on Wednesday that during its April 25 to May 2 visit the mission will hold meetings with the officials of the Ministry of Finance's Finance Division, Financial Institutions Division, Economic Relations Division (ERD), Bangladesh Bank, and National Board of Revenue (NBR). IMF Asia and Pacific Division Head Rahul Anand will lead the team comprising three to four members, the ministry sources said speaking on condition of anonymity. Read More: World Bank spring meeting begins in Washington today, announcement on $50bn allocation to face global crisis likely Bangladesh received the first tranche of US$476.2 million of the $4.7 billion loan approved by the IMF on January 30. The entire amount of the loan will be paid in seven installments in three and a half years until 2026. As such there are six more installments left. A senior official of the ministry said the IMF usually reviews various aspects of compliance before disbursing each tranche. Accordingly, an IMF team will come next September to review the fulfillment of loan conditions before disbursing the second tranche. Read More: Following IMF advice BBS to calculate inflation on a new base year from March Usually before each budget announcement, an IMF mission comes to Dhaka to discuss budget assistance. Now that the loan programme is going on with them, besides the budget assistance, the issues of fulfilling the loan conditions will also come up for discussion, said the sources.

A team of the International Monetary Fund (IMF)is expected to arrive in the capital this week to set the ball rolling on financial sector reform, as part of the $4.5 billion loan program agreed with the Bangladesh government. The IMF team will hold discussions with Bangladesh Bank, key personnel in the Finance Division, as well as officials at the Ministry of Forest, Environment and Climate Change – around $1.3 billion of the loan amount will be disbursed under the Resilience and Sustainability Facility (RSF). The RSF is expected to provide affordable, long-term financing to support Bangladesh’s climate investment needs, catalyze climate financing, and reduce balance of payment pressures from import-intensive climate investment. Read more: IMF loan program can be touchstone of financial sector reforms During their stay here, the delegation would want to know updated information on different economic indicators with a view to releasing the next installment of the loan for Bangladesh, sources at Bangladesh Bank told UNB . The central bank is implementing different policy reforms including on reserves, foreign exchange rate, monetary policy, loan recovery, interest rate, GDP and inflation issues. Among the proposed reforms is to let the currency float against the US dollar – it remains to be seen just how far the central bank will ultimately go on this. The proposals also include allowing the private sector to import fuel, and increasing electricity prices at the retail level. Read more: IMF approves $4.7 billion loan for Bangladesh Besides, a long-term plan will be made to make the prices of imported goods, including energy products, use-based and to increase the tax-GDP ratio. A decision has already been taken from the highest level of the government regarding the implementation of these measures, the official said.  

Bangladeshi officials have received indications from the International Monetary Fund (IMF) that the multilateral lender's board has agreed in principle to approve the country's loan request. Several officials of the Ministry of Finance said that the IMF will approve the loan for Bangladesh on Monday (Jan 30). An IMF team led by Rahul Anand visited Dhaka from October 26 to November 9, 2022, to thrash out the details of the program.  Read: IMF to support Bangladesh’s aspirations of becoming a higher-income country by 2041: DMD After that the IMF's deputy managing director, Antoinette Monsio Sayeh, visited Bangladesh from January 14-18 and praised the economic development and social progress she witnessed during her visit, saying it has left an impression on the whole world. Sayeh also congratulated Prime Minister Sheikh Hasina on that. Former IMF economist Dr Ahsan H. Mansur told UNB that is known of the visits and discussions held with the Ministry of Finance, Bangladesh Bank, National Board of Revenue, Ministry of Planning, Bangladesh Bureau of Statistics (BBS), and others indicates the global lender has reached an agreement to provide $4.5 billion loan to the country. The first instalment of the IMF loan is just awaiting formalities, he said. "We are getting the loan just the way we wanted. A total of $4.5 billion will be leant to Bangladesh," Finance Minister AHM Mustafa Kamal told the media earlier. The amount will be disbursed in seven installments till December 2026. The first installment of $447.78 million will be cleared in February. The remaining amount will be in six equal instalments of $659.18 million each. Read: Bangladesh Bank expects first instalment of $4.5 b IMF loan to arrive by next month: Spokesman The interest rate of the loan will depend on the market rate at the time of maturity. The Finance Ministry has calculated that the rate would be around 2.2 percent, sources said. The IMF earlier stated that its delegation led by Rahul Anand  and the Bangladesh authorities had agreed on a program to support Bangladesh's economic policies with a 42-month arrangement of about $3.2 billion under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) as well as of about $1.3 billion under the Resilience and Sustainability Facility (RSF).  

Prime Minister Sheikh Hasina on Wednesday told Parliament that the loan Bangladesh is taking from the International Monetary Fund (IMF) has no significant conditions attached with it. “IMF provides loan to a country only when it has the capacity to repay the loan. We’re not taking loan (from IMF) with any conditions,” she said replying to an opposition lawmaker in the House. Taking the floor on a point of order, Jatiya Party lawmaker Mujibul Haque Chunnu said Bangladesh is now meeting some conditions to get loan from IMF and already raised the electricity tariff and will increase gas price due to the loan and this will lead to soaring prices of commodities and inflation. PM Hasina said the government is providing subsidy to power and gas. “My question is that which other country of the world provides subsidy to electricity and gas. We’ve increased the electricity generation and ensured electricity supply. But all will have to exercise austerity in using electricity,” she said. Read more: Bangladesh to be first in Asia to receive loan from IMF’s ‘Resilience and Sustainability Fund’ She said the price of electricity was raised by 150 percent in England following the Ukraine-Russia war. “We’ve just enhanced the price of electricity by only 5 percent and also raised the price of bulk gas to some extent now,” she added.   The PM said the spot price of LNG which was only US$ 6 is now US$ 68 US dollar in the international market. “If so, how much subsidies will the government provide?  The government provides the subsidies from the public money,” she said. She said the commodity prices have soared throughout the world. In Bangladesh, the government provided fair price card and TCB card for the lower and middle-income people so that they can purchase some essential commodities including rice at subsidized rates, she added. The premier said, “We’re providing huge subsidy to agriculture. Now if we need to provide Tk 40,000-60,000 crore to electricity-gas generation and supply then how will we provide this?” She said the inflation came down slightly in December and January last in the country. The food inflation is 13.3 percent in a country like England. The same situation prevails in all other countries of the world. But Bangladesh has not fallen into such situation yet, she added. The PM put emphasis on austerity in usage of electricity and gas. The use of electricity was reduced by 50 percent in Prime Minister’s Office and Ganabhaban. If all take such measures, they can practice austerity in the use of electricity, she said Read more: Pay production cost to get smooth supply of gas, electricity: PM Hasina tells industries Sheikh Hasina said she clearly told the businesspeople that the government can provide uninterrupted gas supply to them, if they agree to pay the same rate what the government spends to procure gas from international market. “If they want uninterrupted gas supply, they would have to pay the same price what the government needs to procure gas. There is no reason to provide subsidy here,” she said. In reply to a question from Jatiya Party MP Syed Abu Hossain, the PM said the risk of food crisis has emerged due to the overall economic and social negative impacts of the overlong Covid-19 pandemic and the Russia-Ukraine war. She said the overlong Corona pandemic and Russia-Ukraine war have impacted the global economy and Bangladesh is no exception here. Hasina said her government has taken various measures to ensure no food shortage occurs in the country due to global economic recession and food crisis. The measures include increasing farm production by brining all the fallow lands under cultivation, construction of modern food godowns and ensure storage of safe foods. Responding to another question from Awami League lawmaker M Abdul Latif, the premier placed the statistics on the progress building 10 mega projects. Sheikh Hasina said she clearly told the businesspeople that the government can provide uninterrupted gas supply to them, if they agree to pay the same rate what the government spends to procure gas from international market. “If they want uninterrupted gas supply, they would have to pay the same price what the government needs to procure gas. There is no reason to provide subsidy here,” she said. In reply to a question from Jatiya Party MP Syed Abu Hossain, the PM said the risk of food crisis has emerged due to the overall economic and social negative impacts of the overlong Covid-19 pandemic and the Russia-Ukraine war. She said the overlong Corona pandemic and Russia-Ukraine war have impacted the global economy and Bangladesh is no exception here. Hasina said her government has taken various measures to ensure no food shortage occurs in the country due to global economic recession and food crisis. The measures include increasing farm production by brining all the fallow lands under cultivation, construction of modern food godowns and ensure storage of safe foods. Responding to another question from Awami League lawmaker M Abdul Latif, the premier placed the statistics on the progress building 10 mega projects.

International Monetary Fund (IMF) has assured of continued support to Bangladesh’s aspirations to become a developed and higher-income country by 2041. IMF Deputy Managing Director Antoinette Monsio Sayeh made the assurance during a meeting today (January 16, 2023) with Prime Minister Sheikh Hasina at the latter’s official residence Ganabhaban. PM’s speechwriter Md Nazrul Islam briefed reporters after the meeting. “Bangladesh aspires to become a developed, prosperous, and higher-income country by 2041. The IMF will continue to support this aspiration,” the IMF senior official was quoted as saying. Read more: Bangladesh Bank expects first instalment of $4.5 b IMF loan to arrive by next month: Spokesman She said the IMF has a long-standing partnership with Bangladesh. “The IMF cherishes this partnership. I have come here to strengthen the partnership further,” Sayeh was quoted. She said the whole world is facing challenges due to the staggering impacts of the Covid-19 pandemic and the Russia-Ukraine war. In this situation, emerging economies like Bangladesh are facing various problems, particularly inflation, price-hike of commodities and pressure on foreign exchange reserves, the IMF deputy managing director said. The IMF will assist in Bangladesh’s efforts to face these problems, she assured. Read more: IMF DMD arrives in Dhaka today to finalize $4.5 billion loan The prime minister said the pace of the country’s progress has slowed down due to the Covid-19 pandemic, Russia-Ukraine war and resulting sanctions, counter-sanctions. Bangladesh is also facing difficulties due to price hike of commodities, she said, adding that the government has widened the social safety net and expanded food programmes to support the lower income people. Sheikh Hasina told the IMF official that her government has undertaken development programmes targeting poverty alleviation and food security. She said Bangladesh is bringing fallow lands under cultivation to boost food production. Read more: IMF’s DMD due in Dhaka on Jan 14 to finalise $4.5bn loan deal Lower-income people are suffering due to high inflation even in many developed countries, she added. ‘SEEKING IMF ASSISTANCE NOT AS BAILOUT, BUT AS PRE-EMPTIVE MEASURE’ The PM said Bangladesh has sought assistance from the IMF as a pre-emptive measure. “We have sought assistance from the IMF not as a bailout, but as a pre-emptive measure.” The IMF deputy managing director praised the socio-economic transformation under the leadership of Prime Minister Sheikh Hasina. She said Bangladesh has been maintaining some 6 percent GDP growth over the last decade. Read More: IMF loan is like a character certificate: PM’s advisor Mashiur Besides, women empowerment, girls’ education, community clinics and ICT came up for discussion during the meeting. Finance Minister AHM Mustafa Kamal, PM’s International Relation Affairs Adviser Professor Dr. Gowher Rizvi, Principal Secretary M. Tofazzel Hossain Miah, Bangladesh Bank Governor Abdur Rouf Talukder, Senior Finance Secretary Fatima Yasmin and IMF Resident Representative in Dhaka Jayendu De were present at the meeting. At the meeting, the IMF delegation handed over two photographs to the prime minister, which were taken when Bangladesh signed the IMF’s Articles of Agreement on August 17, 1972 to obtain its membership. Read More: IMF acknowledges Bangladesh’s outstanding socioeconomic progress: Finance Minister

The Deputy Managing Director (DMD) of the International Monetary Fund (IMF), Antoinette Monsio Sayeh, arrives in Dhaka today (January 14, 2023) for a 5-day visit. She will stay in Dhaka till January 18. During her visit, Sayeh will meet with the prime minister, finance minister, governor of Bangladesh Bank and other senior officials of the government. According to finance ministry sources, Sayeh is coming to Dhaka from Delhi after completing her current Indian visit. The IMF DMD will visit Padma Bridge on January 18. A meeting with Prime Minister Sheikh Hasina is scheduled for January 16. Sayeh will report to the IMF headquarters regarding the $4.5 billion loan for Bangladesh to combat the global recession. Read more: Govt works to implement IMF conditions to get $4.5 billion loan: Official The report will be presented at the IMF board meeting. Based on this, the process of providing the loan will be finalized. The government has reached an in-principle agreement on the loan with the IMF. Now only the formalities remain. Some conditions have already been implemented. Electricity prices were hiked by an average of 5 percent on Thursday to implement another IMF condition. The government will seek some time to implement some other IMF conditions. Read more: Government working on IMF’s conditions to get $4.5 billion loan Meanwhile, Bangladesh Bank will announce the new monetary policy for the period from January to June of the current financial year tomorrow in accordance with the conditions of the IMF. It will give the impression of raising the loan interest rate to a limited extent. At the same time, monetary policy will be used to control the rate of inflation. For this reason, the matter of increasing the policy interest rate of the central bank is also in the process. The government hopes to receive the first installment of the IMF loan in February. For the first installment, $45.45 crore will be received. Thereafter one installment will be made every six months. Read More: IMF loan is like a character certificate: PM’s advisor Mashiur