Finance Minister
Chunnu wants finance minister's view on reported corruption of MPs, WASA MD
Speaking in parliament, Jatiya Party MP Mujibul Haque Chunnu on Sunday placed a question for Finance Minister AHM Mustafa Kamal on whether news published in different media recently about overseas property and assets owned by Bangladeshis, including MPs, is true or false.
He also demanded that the government investigate these matters. Chunnu was speaking on a point of order.
Finance Minister AHM Mustafa Kamal, however, was not present in the house.
Chunnu said news was published that the WASA MD owns 23 houses in USA. Such questions are coming about two members of parliament as well.
"I request the finance minister to tell us whether all these news are true or not. Because our foreign minister said earlier that there are many bureaucrats among those who are making their homes in Begum Para in Canada. There should be an inquiry into all these things. These allegations should be resolved,” Chunnu said.
Also read: JP’s Rustum Ali Faraji blasts Finance Minister for his silence on state of economy
Urging the finance minister to open his mouth on these issues, Chunnu said that different media are publishing such news ahead of the next election which is tarnishing the image of the government as well as their (JP's) image as the opposition party.
The JP MP said such news is sending the wrong message among the people of the country that MPs and ministers earn hundreds of crores of taka and making houses in From in home and abroad.
He said the finance minister should open his mouth about this.
The Finance Ministry along with the Bangladesh Bank should conduct an investigation and make a clear statement on the matter, he added.
JP’s Rustum Ali Faraji blasts Finance Minister for his silence on state of economy
Finance Minister AHM Mustafa Kamal on Thursday came under fierce attack from a Jatiya Party MP for maintaining silence on the country’s various ongoing economic issues.
Jatiya Party lawmaker Md. Rustum Ali Faraji in Parliament strongly criticised the Finance Minister participating in the discussion on the thanksgiving motion on the President’s speech.
Read more: Govt on track to introduce ‘lawful interception system’ to monitor social media, thwart anti-state activities: Home Minister tells JS
The opposition MP from Pirojpur-3 said the Finance Minister does not talk about the sorry state of the stock market, ongoing economic situation, foreign reserves and remittances.
“He is a very dignified, modest, experienced, insightful person. He cannot be disrespected. But why is he silent?”
The JP MP, however, highly lauded Prime Minister Sheikh Hasina.
Faraji said that many are becoming loan defaulters in a 'freestyle'. They are making money through corruption and bribery and those money are being laundered abroad, he said.
“This is the responsibility of the Finance Minister to look into this matter. But he is not saying anything about this. He became completely silent. The Finance Minister has to answer. Take part in the debate,” he said.
“I hope he (the minister) will explain these issues.”
Faraji said the money, which has been laundered, should be brought back to the country.
“It is the Finance Minister's responsibility to do this.”
Read more: 1st quarter performance of FY22-23 budget satisfactory: Finance Minister
The JP MP urged the minister to publish photographs of those who looted and smuggled thousands of crores of taka in newspapers.
“Then people will see those photographs and spit on them. Because they're not human beings."
Faraji said that many people want to become ministers again and again. Because there are mines for money there, he said.
“They want to become ministers for money,” he said.
1st quarter performance of FY22-23 budget satisfactory: Finance Minister
The position of basic macroeconomic indexes including revenue collection, remittances, export growth, annual development programme (ADP) expenditure and money supply in the first quarter (July-September) of the running 2022-23 fiscal was satisfactory.
This was stated by Finance Minister AHM Mustafa Kamal on Thursday in a report placed in the House on the progress of the implementation 2022-23 budget in the financial year’s first quarter.
“Revenue collection was done as per the target, positive trend was seen in import and export income, and as a result I am hoping that we will be able to attain our desired target in the current budget,” he said.
Read more: No new pay scale, dearness allowance for govt employees right now: Finance Minister
He mentioned that the revenue collection registered 19.33 percent in the first quarter which was 18.72 percent in the last fiscal.
The public expenditure was 11.14 percent against 11.90 percent in the same period of 2021-22 fiscal while implementation rate of ADP was 8.55 percent against 8.26 percent.
The finance minister said that due to the increase of import expenditure there was deficit in the current account balance that reduced to USD 36.47 billion in the reserve on September 30, 2022 which was USD 46.22 billion in the same period of 2021.
The growth in the remittances inflow was 4.89 percent against 19.44 percent in the previous 2021-22 fiscal.
The export income growth rate was 13.38 percent against 11.37 percent during the same period of the last fiscal.
“The positive trend of export trading growth will play as important variable in advancing our economy,” he said.
He said that the import expenditure (C&F) increased 11.67 percent which was 47.56 percent in the same time of the last fiscal.
He said that normalisation of economic activities after COVID-19 period and significant rise of import of intermediary and capital machineries led to a huge hike in import expenditure.
Read more: Legal process underway to bring home laundered money: Finance Minister
“But, currently avoidance of luxury items and exercise of austerity by the government caused a decrease in import expenditure,” he said.
The LC opening during July-September tenure in 2022 was USD 18.58 billion which was 4.57 percent less than the same period of the previous fiscal.
As per the report, annual average inflation was 5.50 percent in September 2021 while it increased 6.96 percent in September 2022. On the other hand, the point-to-point inflation in September 2021 was 5.59 percent, while it increased to 9.10 percent in 2022.
Regarding the budget deficit Mustafa Kamal said that the estimated deficit is 5.51 percent of the GDP. For deficit financing 2.22 percent sill come from external sources while 3.29 percent would be mitigated from domestic sources.
He said that to contain pressure from inflation, the central bank took the path of contractionary monetary policy.
The minister said that thanks to timely steps from the government it was possible to contain the inflation forced by price hike of fuel oil price and food items due to the Russia-Ukraine War, and depreciation of Taka against US Dollar.
Tk 32.46cr due: Govt confiscates Regent Airways’ bank account
The government has confiscated the bank account of Regent Airways to collect the dues of Tk 32.46 crore, Finance Minister AHM Mustafa Kamal said in parliament on Tuesday.
Responding to a tabled question from Awami League MP Mohammad Habib Hasan, the minister said that Regent Airways owes the government Tk 32.46 crore in travel tax, but Tk 1.37 crore has been recovered by confiscating the bank account.
Read more: United Airways reiterates commitment to revive the airline
In his question, Habib Hasan wanted to know whether there is any unpaid dues of travel tax from domestic airlines. He also wanted to know what steps the government has taken to collect the dues.
Due to Regent Airways being shut down, the dues remain unpaid. Their bank accounts were seized to collect the unpaid dues, the finance minister said.
Read more: 'Air Incheon-Korean Airlines’ introduces direct cargo flight from Bangladesh to South Korea
In the wake of the coronavirus pandemic, Regent Airways postponed all its international and domestic flight operations in 2020.
No new pay scale, dearness allowance for govt employees right now: Finance Minister
The government has no plan to announce new pay scale or dearness allowance for the government employees right now, Finance Minister AHM Mustafa Kamal said in Parliament on Tuesday.
The minister said this in reply to a tabled question from Gonoforum MP Mokabbir Khan.
Read more: Primary school headmasters to get grade 10 pay scale: SC
The finance minister said that the government issued the National Pay Scale Order in 2015, which is still in force.
In the past, government employees were given the benefit of salary increment every year as per the pay scale order.
But, due to the provision of increase in percentage of the basic pay in the National Pay Scale 2015, the annual salary of the government employee increase at a fixed rate up to a certain limit, which has been playing a positive role in improving the standard of living of the government employees at all levels, the minister said.
“Amid the post-Covid global recession, inflation has increased around the globe with hike in commodity prices, which has also affected Bangladesh.The government has taken various steps to control inflation and normalize the market situation.”
Read more: Govt employees demand amending 8th pay scale
The finance minister said that in the current situation, the government has launched a programme to provide daily essentials through family cards at a lower price.
The government is trying to take practical steps to increase the financial capacity of people.
“In this situation, there is no plan to announce new pay scale or dearness allowance for the government employees at this moment,” Kamal said.
Govt formulating policy to appoint MDs, senior posts at SCBs
The financial institution division (FID), a wing of the Ministry of Finance is formulating 'The Employment, Promotion and Posting Policy-2023' for the appointment and promotion of senior officers of state-owned commercial banks of Bangladesh.
A committee led by the finance minister will appoint and promote people to these posts based on the basis of 100 marks in 8 categories, a source of the ministry told UNB on Sunday.
Apart from this, the candidates will be scrutinized before the appointment. A committee of 6 members will be formed, led by the finance minister.
Read: Investors’ financial literacy must to boost capital market: Commerce Minister
According to the sources, contractual recruitment and posting for a maximum of three years will be made for the posts of Managing Director (MD) and Chief Executive Officer (CEO) through selection from among the Managing Directors working in state-owned commercial banks, specialized banks, and financial institutions or through promotion from Deputy Managing Directors (DMDs).
Sources of FID said recommendations will be made by the selection committee following the seniority, experience, report of the NSI and Anti-Corruption Commission, and the circular issued by Bangladesh Bank from time to time.
Contractual appointments will be made to the posts of Managing Director and CEO with the recommendation of the committee with the approval of the Prime Minister.
Read: Bangladesh earned $27.22b from exports in July-Dec amid new records
A senior official of FID said apart from this, promotion, appointment, posting and inter-bank transfers to the post of Deputy Managing Director in specialized banks and financial institutions will be restricted to specialized banks and financial institutions.
However, in the interest of the state, posting and inter-bank transfer can be made from among the deputy managing directors of state-owned commercial banks to the post of deputy managing directors in specialized banks and financial institutions.
As per the policy, in the case of promotion, the candidates eligible for promotion-educational qualification mark 15, length of service in a bank or financial institution -5, banking diploma-5, professional degree-5, professional publications -5, employment record 5, annual confidential application -40 and interview -15), etc will be selected by the committee on the basis of their mark out of a total 100 marks.
Read More: Govt to save Tk10,000 cr annually from importing edible oil: Agri Minister.
$4.5bn IMF loan: 1st instalment expected next Feb, says Mustafa Kamal
Finance Minister AHM Mustafa Kamal on Wednesday confirmed Bangladesh will get $4.5 billion from the International Monetary Fund amid hope that the lending agency will release the first installment of the much-needed loan by next February.
He said this in a briefing after meeting with the IMF delegation held at the ministry’s conference room at the Secretariat on Wednesday.
Separately, the IMF said it has reached staff-level agreement with Bangladesh government on the loan. The agreement came following two weeks of negotiations with a visiting IMF team and Bangladesh officials ending on Wednesday.
Read more: $4.5 billion loan: IMF reaches preliminary agreement with Bangladesh
“The amount of loan is $4.5 billion,” confirmed Kamal. “The loan will be available in seven installments until 2026.”
“I hope that the IMF will be able to release the first installment of SDR352.35 million by next February. The remaining loan will be available in six equal installments of SDR 519 million every six months until December 2026 under Special Drawing Rights (SDRs),” he added.
SDRs are allocated based on the quota amounts of each IMF member country. The higher the quota amount, the larger the SDR allocation a country will receive. In general, stronger economies have higher quotas.
The finance minister said that the IMF mission has informed this according to their action plan. All the formalities and final board approval of the loan proposal will be completed within the next three months.
Read more: Bangladesh will take IMF loan, but not under hard conditions, says Obaidul Quader
Under the extended credit facility (ECF) Bangladesh will get interest-free SDR822.82 million. Under the extended fund facility (EFF) the country will get SDR1645.64 million at a floating SDRi+1 percent interest rate while under the resilience and sustainability facility SDR1 billion will come at a floating SDRi+ 0.75 interest rate, according to the official documents of the finance ministry.
Kamal said that the economy of the whole world is going through a transitional period. Abnormal inflation has occurred in all developed and developing countries. Almost all countries' currencies depreciated against the dollar.
In reply to a question, he said the foreign exchange reserves have decreased as the global economic crisis has affected Bangladesh’s economy to some extent.
“We requested the IMF for the loan as a pre-emptive measure to ensure that this instability does not escalate into a crisis. They have met several times before. We have successfully completed the ongoing loan negotiation,” the minister added.
Read more: IMF for capacity building of capital market in Bangladesh
The visiting IMF team held discussions with all stakeholders of the Bangladesh government, especially those involved with the financial sector.
“They (IMF) told us that our macroeconomic management is better than many other countries. The IMF team agrees to our ongoing economic reforms. Accordingly, we are going to take a four-year loan programme,” Kamal said.
The Washington-based global lender’s delegation arrived in Bangladesh on October 26 to discuss the loan request and make a first-hand assessment of the economic situation after Dhaka sought the loan in July this year.
This is Bangladesh’s highest amount of loan sought from the IMF as the economy has been hit by the Covid-19 pandemic and the Russia-Ukraine war leading to a fall in the foreign exchange reserves.
During the visit the IMF team held a series of meetings with the finance ministry, Bangladesh Bank, Bangladesh Bureau of Statistics, Power Division, Bangladesh Energy Regulatory Commission, Bangladesh Garment Manufacturers and Exporters Association (BGMEA), ERD, NBR, BIDA, and other financial organizations.
UK Finance Minister Kwasi Kwarteng sacked
UK Prime Minister Liz Truss has appointed former Cabinet minister Jeremy Hunt as new Treasury chief, replacing sacked Kwasi Kwarteng.
Hunt is a government veteran who has served as former foreign secretary and health secretary, and ran unsuccessfully to lead the Conservative Party in 2019.
Truss also replaced the second highest-ranking Treasury minister in a bid to restore order after weeks of turmoil over the government’s economic plans.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Embattled British Prime Minister Liz Truss fired her Treasury chief ahead of a hastily arranged news conference on Friday as she struggled to calm markets and hang on to her job following the release of a controversial economic plan.
Kwasi Kwarteng’s departure comes after just over a month in the job — and three weeks after he announced a tax-cutting “mini budget” that sent the pound plunging to record lows against the dollar.
Kwarteng tweeted his departure letter to Truss, saying “You have asked me to stand aside as your Chancellor. I have accepted.”
He defended the government’s economic plan, saying the country faces an “incredibly difficult” situation and “following the status quo was not an option.”
Market reaction was muted, having already baked in the notion that the government will back down on some of its key proposals.
Truss is due to hold a news conference later Friday. She is under intense pressure to scrap some of the 43 billion pounds ($48 billion) in unfunded tax cuts that roiled financial markets and led the Bank of England to step in to prevent a wider economic crisis.
Senior members of the Conservative Party were publicly advising the government to take action. The pound rose as much as 1.7% against the dollar on Thursday and bond markets stabilized amid expectations that Truss would revise the economic growth plan.
Read: New UK PM Truss vows to tackle energy crisis, ailing economy
Truss, a free-market libertarian, came to power last month pledging to cut taxes to spur growth. But her ability to deliver on that commitment is now in doubt.
Analysts suggest the most likely change in her program would be to abandon a promise to halt her predecessor’s plan to increase corporation tax from 19% to 25%. That would reduce the bill for her program by about 18 billion pounds a year.
James Athey, the investment director at abrdn, said that it now seemed certain that the government “is about to U-turn on its decision not to U-turn on its profligate tax-cutting policies.″ The rumors are calming markets, he said.
“The risk now is that investors have forgotten that there are significantly more problems than just an ill-advised and ill-timed fiscal easing to deal with,″ he said. “Inflation is at multi-decade highs, government borrowing is huge as is the current account deficit. The housing market is likely to suffer a hammer blow from the jump in mortgage rates and the war in Ukraine rumbles on. We may well be through the worst of the volatility but I fear that the U.K. is nowhere near out of the woods.”
Conservative lawmakers are agonizing over whether to try to oust their second leader this year. Truss was elected last month to replace Boris Johnson, who was forced out in July. Some reports suggest senior Conservatives are plotting to replace Truss with a joint ticket of Rishi Sunak and Penny Mordaunt, her two closest rivals in the summer contest for leadership of the party, though it’s unclear how that could be achieved.
Market-based foreign exchange rate may be introduced soon: Finance Minister
Finance Minister AHM Mustafa Kamal has said that the government is considering introducing market-based foreign currency exchange rates.
“We’re contemplating going for market-based foreign exchange rates. Today or tomorrow, we’ll have to go for market-based trading of foreign currency,” he told reporters while briefing on the outcomes of two consecutive meetings of the Cabinet Committee on Economic Affairs (CCEA) and Cabinet Committee on Government Purchase (CCGP) on Wednesday.
Read: No IMF proposal received to raise power, petroleum prices: Finance Minister
The finance minister’s remarks came against the backdrop of the recent instability in the foreign currency market where the US dollar’s exchange rate recently went up to Tk 119 from Tk 85.
Bangladesh Bank recently fixed exchange rate at Tk 95 while in private banks dollar was being traded at TK 108.
Responding to a question on re-fixing the bank lending rates, he dismissed the possibility of any upward or downward change in lending rates against the existing rates of 6-9 percent interest on deposits and bank loans.
Read: Nothing wrong in economy as Bangladesh seeks IMF loan: Finance Minister
“The current interest rates between 6-9 percent are working well,” he said.
He said many countries pursue the path of increasing interest rates to contain inflation.
“But it is very tough in countries like Bangladesh to contain inflation by increasing or decreasing interest rate,” he said, adding, the central bank here does the job in two ways – by taking fiscal measures and monitoring the market.
About foreign exchange reserve, he said the foreign currency reserve is in good state.
Read Chinese ambassador meets Bangladesh finance minister
“Our remittance is increasing while export is rising and import is decreasing”, he said, claiming that there is no crisis in the foreign currency market. The foreign exchange reserve will again go up to $48 billion soon.
Responding to another question on import of Russian fuel in roubles, the finance minister said work is in progress in this regard.
“But in such a case, Bangladesh will have to do it through currency swap. Russia has to accept our currency first,” he said.
Read No IMF proposal received to raise power, petroleum prices: Finance Minister
Chinese ambassador meets Bangladesh finance minister
Chinese Ambassador to Bangladesh Li Jiming on Sunday met Finance Minister AHM Mustafa Kamal in the capital.
The two sides exchanged views on the issues related to boosting trade and economic cooperation between Bangladesh and China.
Read: Home Minister drops in on Bachelet
Economic and Commercial Counselor Liu Zhenhua accompanied Li Jiming at the meeting.