Following extended negotiations, the government has finalized a staff-level agreement with the IMF, paving the way for the release of the fourth and fifth tranches under the $4.7 billion loan programme. An extra $762 million has been sought by the government to tackle several microeconomics challenges.
The IMF stated that the authorities had reiterated their commitment to the objectives of the reform programme, including implementing fiscal reforms to address the emerging external financing gap, calibrating monetary policy to reduce inflation, and fully carrying out exchange rate reforms to enhance flexibility.
Approval from the IMF board is now awaited for the $1.3 billion disbursement and the proposed top-up to the existing loan programme. The board’s approval is contingent on the completion of prior actions, including measures to boost tax revenue and the full implementation of exchange rate reforms, said Chris Papageorgiou, the IMF mission chief for Bangladesh, in a statement, as reported by The Daily Star.
“The authorities reiterated their commitment to the reform programme’s objectives, including fiscal reforms to address the emerging external financing gap, calibrated monetary policy to reduce inflation, and full implementation of exchange rate reforms to enhance flexibility,” the statement added.
According to the Finance Ministry, both parties conducted a thorough review of all issues in the interest of preserving Bangladesh’s macroeconomic stability and reached an agreement on reforms related to revenue management, exchange rate policy, and other structural areas.
