The inward remittance flow in January came as good news while Bangladesh Bank (BB) is struggling with LCs liabilities to import essential commodities and industrial raw materials amid volatile foreign exchange supply. In January, Bangladesh received $1.96 billion in the legal channel, the BB updated data revealed on Wednesday. In December, the remittance was $1.69 billion. Bangladesh received $12.45 billion inward remittances in seven months (July-January) in the current fiscal year 2022-23. Read More: Banks to stop charging any fees for handling remittances. Bank officials said many import payments are being deferred due to the dollar crisis. For this, expatriate income of dollars are being bought at a higher price than the fixed price. As a result, expatriate income increased. If the price limit of the dollar is removed, the crisis will go away, they said. The BB spokesperson Mesbaul Haque told UNB that in order to increase remittance inflow, the central bank has increased the exchange rate of US dollars for remittance. Read more: Bangladesh Bank simplifies receiving remittance In addition to a 2.5 percent hassle-free incentive for remittance, several banks also provide additional incentives to attract foreign exchange, he said. Banks will not cut any charge or fee for sending remittances in the legal channel, he said. Research by Bangladesh Bank found that more than 40 percent of remittance of expatriate income is sent to the country through hundi. Read More: Bangladesh 9th in remittances with US$ 15.9b: World Bank.
Although Bangladesh may not go into recession, the country is significantly prone to many of the recessionary risks if appropriate steps are not taken to diversify the export product and basket and increase remittances through formal channels, said the International Chamber of Commerce-Bangladesh (ICCB) on Thursday. The ICCB in its latest editorial also highlighted the importance of taking appropriate measures to streamline public sector expenditures, rationalize mega infrastructure and other projects and undertake effective financial sector reforms. The global economy surpassed $100 trillion for the first time in 2022, but is likely to stall in 2023 due to last year’s multifaceted shocks and challenges. The three main global growth engines -- the US, Europe and China-- will experience slower growth in 2023, according to the editorial. In Bangladesh, according to experts, a major effort should be directed toward strengthening macro-prudential regulations and building foreign exchange reserves. Fiscal measures should carefully regulate withdrawal of fiscal support measures while ensuring consistency with monetary policy objectives. Read more: Accelerate gas exploration to overcome energy crisis: ICCB A credible medium-term fiscal plan should be in place, among others, to provide targeted relief to vulnerable households. The supply side measures should aim to ease labor-market constraints, increase labor-force participation, reallocation of displaced workers and reduce price pressures. Effective policy coordination will be important in increasing food and energy supply. For the energy sector, policies should accelerate the transition to low–carbon energy sources and introduce measures to reduce energy consumption to face climate change. Higher-than-expected and persistent inflation, tightened financial conditions, Russia's war against Ukraine, lingering COVID-19 pandemic and supply-demand mismatches have further slowed the global economic outlook, according to the editorial of the ICCB. IMF Chief Kristalina Georgieva warns that one-third of the world economy could be in recession in 2023. Even countries that would not be in recession, would feel the recessionary pressure for millions of people, she adds. Russia’s invasion of Ukraine not only threatens the lives of millions of Ukrainians but has also accelerated a series of cascading and interconnected global crises in food, fuel, and energy, resulting in rising cost of living further adding inflationary pressure in many countries. In addition, extreme weather conditions due to climate change pose downside risks to the global economic outlook, and increasing energy prices also hamper the path toward a green transition, said ICCB. The persisting global challenges have caused rising debt vulnerabilities and hampered the way toward recovery, which further impacted the vulnerable groups, especially low-income and developing countries. The largest slowdown of global trade in generations, significant decline in FDI, private capital flows and remittances are also contributing to global recession. The likely recession in the developed world will spur capital outflows from the developing countries forcing them to devalue their currencies, thus adding to rising inflation and consequently to increasing interest rates. According to a recent comprehensive World Bank study, the risk of global recession in 2023 has risen sharply as the central banks across the countries have hiked interest rates in response to inflation. Read more: ICCB: Russia-Ukraine war must end for the sake of humanity, development Yet the indications so far show these policy actions may not be sufficient to bring global inflation back to normal. Indications are there that global consumer confidence has suffered a sharp decline. It is apprehended that unless supply disruptions and labor market pressures subside, the global core inflation rate may remain high. At the global level, the key will be to strengthen global trade networks to alleviate supply bottlenecks. Now is the time to promote a rules-based international economic order that prevents the threat of protectionism and fragmentation that would further disrupt trade networks, said the ICCB. In line with current global economic challenges, G20 members have reaffirmed their commitment to well-calibrated, well-planned, and well-communicated policies to support sustainable recovery and mitigate scarring effects to support strong, sustainable, balanced, and inclusive growth. In this regard, the G20 has reaffirmed the importance of macro-policy cooperation to preserve financial stability and long-term fiscal sustainability and safeguard against downside risks and negative spillovers. Amazon founder Jeff Bezos, speaking to CNN recently warned consumers and businesses that they should consider postponing large purchases during the holiday season to keep their cash safe as an economic recession might be in the offing. While the central banks should continue with their efforts to control inflation to help anchor inflation expectations and reduce the degree of monetary tightening, concerted actions are needed by other policymakers as well.
Bangladesh received USD $1.70 billion inward remittance in December 2022 through the banking channel, up by 4.23 percent compared to the same month of the previous year. In November, the expatriates sent home $1.59 billion through the legal channel, according to Bangladesh Bank an updated report released on Sunday. The central bank has been trying to increase inward remittance flow through banking channels by offering incentives and higher exchange rates of the US dollar. Read: BB moves to encourage greater flow of remittance to boost forex A review of the remittance flow showed that the total remittance received in the first 6 months of the fiscal year 2022-23 (July- December) was $ 10.49 billion. In the same period of the previous financial year, the expatriates sent $10.24 billion in remittances. Accordingly, in the first 6 months of this fiscal year, Bangladesh received $287 million more in remittances. The BB spokesperson Mesbaul Haque told UNB that in order to increase remittance inflow, the central bank has increased the exchange rate of US dollar. Read: Bangladesh received $357.76mn remittance in first week of Oct In addition to a 2.5 percent hassle-free incentive for remittance, several banks also provide additional incentives to attract foreign exchange, he said. Banks will not cut any charge or fee for sending remittances in the legal channel, he said. Research by Bangladesh Bank found that more than 40 percent of remittance of expatriate income is sent in the country through hundi or unofficial channel. Read More: Banks to stop charging any fees for handling remittances
Foreign Minister Dr AK Abdul Momen on Tuesday said the government wants to honor expatriate Bangladeshis in every possible way and ease their sufferings at home and abroad. He said the expatriates have always been supportive to Bangladesh’s economic development and even played a very significant role during the War of Liberation in 1971. “They have kept our economy vibrant by sending remittances. We want to engage them more in our economic development,” he told reporters after attending a programme in the city. Momen said the government has taken a decision to observe December 30 as the National Expatriates Day. The Cabinet on Monday approved the proposal. Read more: Bangladesh requests Bahrain to recruit more skilled workers, IT professionals Asked whether the government has decided to impose new restrictions along the border and airports to contain Covid-19, Momen said they are yet to discuss the matter. Responding to a question on rape cases, the foreign minister said they want not a single rape case in the country but it cannot be done without social movement. Earlier, the foreign minister spoke as the chief guest at a national level sharing meeting on civil-society led alternative CEDAW (Convention on the Elimination of All Forms of Discrimination against Women) reporting hosted by Bangladesh Mahila Parishad and UN Women. Read more: Foreign Minister asked to place a report on stranded expats
The monthly inflow of remittances hit an all-time high in April ahead of Eid-ul-Fitr, reaching $2.067 billion. Expatriate Bangladeshis sent $1.91 billion in remittances in March; which rose 8.19% in April, according to the Bangladesh Bank. Read bKash offers 1 pc cash bonus on receiving remittance Expatriates sent $2.06 billion in remittance in April, up 89.17% year-on-year from the same period of last year. Remittance inflow usually increases ahead of Eid-ul-Fitr and Eid-ul-Adha, as the expatriates send a big chunk of foreign currencies to the country ahead of two major religious festivals of the Muslims, experts said. Read BB further simplifies outward remittance rules for industrialists Although the pandemic has slowed down the global economy, remittance inflow grew 39% to $20.67 billion in the first 10 months of the current fiscal year, compared to the same period of the last fiscal. The remittance earnings have begun an upward march amid the Covid-19 pandemic as the government and the central bank took several initiatives to boost it; the migrant workers have already become used to the legal channels and are enjoying the 2% cash incentive, experts said. Read Remittances: First 6 months of fiscal sees over 37 percent growth
United Nations Secretary-General Antonio Guterres on Sunday appealed for "people everywhere" to support migrants as the World Bank projected that remittances will fall by about 20 percent.