[🇧🇩] Monitoring Bangladesh's Economy

[Saif]

Reserves drop to $19.7b after ACU payment

Bangladesh’s foreign exchange reserves fell from $21.39 billion to $19.7 billion yesterday after the country paid $1.75 billion in regional import bills through the Asian Clearing Union (ACU).

www.thedailystar.net

Reserves drop to $19.7b after ACU payment

Bangladesh's foreign exchange reserves fell from $21.39 billion to $19.7 billion yesterday after the country paid $1.75 billion in regional import bills through the Asian Clearing Union (ACU).

The ACU, a Tehran-based organisation, facilitates payment settlements among nine member countries: India, Bangladesh, Bhutan, Iran, the Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka.

Under the ACU mechanism, Bangladesh clears its import bills every two months, leading to a temporary decline in reserves after each payment.

As of March 6, the country's forex reserves stood at $21.39 billion, calculated in accordance with the International Monetary Fund's (IMF) BPM6 manual.

Due to a growing trend in remittance inflows in recent months, the central bank has been able to mitigate the sharp decline in forex reserves, particularly since the end of the Awami League-led government's regime on August 5 in the face of mass uprising.

Last month, remittance inflows to Bangladesh rose 25 percent year-on-year to $2.52 billion as migrant Bangladeshi workers sent larger-than-expected amounts to their families back home for Ramadan-related purchases and Eid shopping.​

 

[Saif]

Govt releases Tk 10b incentives for exporters

The government has released Tk 10 billion as cash incentive for the country's exporters, according to sources. It offers such incentive and cash subsidy against export earnings. Finance Division issued an order to this end on March 05. It is the third instalment of the export incentive allocated

thefinancialexpress.com.bd

Govt releases Tk 10b incentives for exporters
FE Report
Published :
Mar 10, 2025 08:58
Updated :
Mar 10, 2025 08:58

The government has released Tk 10 billion as cash incentive for the country's exporters, according to sources.

It offers such incentive and cash subsidy against export earnings.

Finance Division issued an order to this end on March 05.

It is the third instalment of the export incentive allocated in the current financial year, 2004-25, for export sectors.

Finance Division has set certain conditions, including providing the amount to different banks and export sectors, for receiving such assistance.

Besides, the banks concerned cannot use the fund for other purposes.

The parties concerned (banks, incentive receivers) should follow the existing policy strictly, otherwise legal action would be taken for non-compliance.

The Office of the Controller General of Accounts will announce the debit authority regarding the issue soon.

The Bangladesh Bank (BB) will provide the incentive as per the demand by the respective banks for making payments to the exporters concerned.

Export-oriented sectors like ready-made garment, frozen shrimp and other fish, leather items, jute and jute products enjoy such incentives, according to an official order of the Finance Division issued recently.

Meanwhile, a special 1.0-per cent cash incentive support fund for the apparel industry has also been included in the instalment.

The government reduced rates of cash incentives against exports for all 43 categories up to 50 per cent for fiscal year 2024-25.​

 

[Saif]

BB relaxes loan exit policy for troubled businesses

Bangladesh Bank (BB) today relaxed the down payment requirements for exit facilities on defaulted loans of closed or loss-incurring companies.

www.thedailystar.net

BB relaxes loan exit policy for troubled businesses

The Bangladesh Bank headquarters in Dhaka. Photo: Star/File

Bangladesh Bank (BB) today relaxed the down payment requirements for exit facilities on defaulted loans of closed or loss-incurring companies.

The central bank issued a notice in this regard.

From now on, such applications can be made with only 5 percent down payment on the existing loan balance, which was previously at 10 percent.

The notice said the management authority can now approve exit facilities for loans up to Tk 20 lakh whereas previously it was Tk 10 lakh.

Loans exceeding this amount will need approval from the board.

Bangladesh Bank on July 08 last year introduced an exit policy for businesses, industries, or projects that were established on loans but have shut down or are incurring losses due to uncontrollable factors.

The policy aimed to recover such loans within a maximum of three years through measures including interest waivers and other facilities.

Loans availing the exit facility will continue to be classified as defaulted until fully recovered.

Some modifications have been brought about in the policy, further relaxing the conditions. The revised policy states that loans availing the exit facility cannot be rescheduled or restructured.​

 

[Saif]

No action taken based on white paper: economist

The interim government has not taken any of the measures recommended by the White Paper on the state of the economy and the task force, even after a long time since the report's submission, said an economist yesterday.

www.thedailystar.net

No action taken based on white paper: economist

Selim Raihan. Photo is taken from his Facebook page.

The interim government has not taken any of the measures recommended by the White Paper on the state of the economy and the task force, even after a long time since the report's submission, said an economist yesterday.

"We are yet to see any progress or discussion inside the government about the White Paper and the task force's recommendations," said Prof Selim Raihan, a member of the both White Paper and Task Force.

"Even the interim government didn't ask us (panel members) to explain what we had written or recommended," said Prof. Raihan, also the executive director of the South Asian Network on Economic Modeling (Sanem).

He made the comments at a seminar titled "Unveiling the Truth: The State of Bangladesh's Economy and Governance," held at the University of Dhaka's Economics Department. The event, organised by the Economics Study Center, was attended by nearly a hundred students.

On 28 August, a 12-member committee was formed, was given three months to prepare the report, submitted on December 01, which aims to provide a clearer picture of the economy.

"There was a significant opportunity for the government to engage with panel members, who are among the country's top economists," said Prof. Raihan.

He further noted that various institutions and ministries could have implemented the recommendations relevant to their respective sectors, but no such steps have been taken.

He believes the interim government could adopt some of the recommendations, setting a precedent for the next political government to build upon and implement them further.

Besides, the taskforce report called "Re-strategising the Economy and Mobilising Resources for Equitable and Sustainable Development" was submitted January 30 to the Chief Adviser.

Prof Raihan said the Awami League government took on many projects without conducting proper feasibility studies, causing great losses for the country.

"Many projects lack proper feasibility studies. Even when studies were conducted, they were often flawed and overestimated," he said.

He also gave examples of Chattogram's Karnaphuli Tunnel, the Rooppur Nuclear Power Plant project, and the Dhaka-Chattogram Highway.

Regarding Sri Lanka's financial recovery, Prof. Raihan said their central bank was free from political interference, which helped them recover quickly from the economic crisis.

Denouncing Bangladesh Bank Governor Ahsan H. Mansur's recent comments on the International Monetary Fund—that Bangladesh does not need IMF funds if it can generate adequate revenue.

"If it happens, that's fair and good. But I fear that we're going to walk away from reform again," said Prof Raihan.​