The financial adviser sought help from the IMF to overcome the reserve crisis

Financial advisor Dr. requested more loans from the International Monetary Fund (IMF) as budget support to solve the foreign exchange reserve crisis. Salehuddin Ahmed. Chris Papageorge, head of the IMF mission in Bangladesh, has assured to look into the matter of giving new loans in view of his call.

On Thursday (August 29) afternoon, Salehuddin Ahmed held a virtual meeting (Zoom meeting) with IMF Mission Chief Chris Papageorgio and the organization's resident representative in Bangladesh, Jayendu Dey. At this time, the Finance Secretary. Md. Khairuzzaman Majumder was present.

A source in the finance ministry said it was actually a courtesy meeting. There the Finance Adviser sought fresh budgetary support from the IMF – outside of the ongoing loan program. However, the advisor did not specify any specific figure for the new loan. The IMF has assured the finance adviser that it will look into the matter.

Meanwhile, according to sources from the Ministry of Finance and Bangladesh Bank, Bangladesh will seek a loan of another 3 billion dollars from the IMF. A delegation from the IMF will visit Bangladesh next September to assess progress in meeting conditions before the fourth installment of the IMF's ongoing $4.70 billion loan is released. Bangladesh will then officially seek an additional $3 billion loan under existing debt.

The IMF approved a loan of 4.7 billion dollars on January 30 last year under the conditions of various reforms in the economic sector to deal with the foreign exchange reserve crisis. Under this loan program of the IMF, Bangladesh has to fulfill several conditions to receive each installment. Despite complying with many other conditions of the loan agreement, Bangladesh is not able to comply with the reserve-related conditions at specified intervals. Despite that, the IMF has already released about 2.31 billion dollars or 230 million 82 million dollars in three installments. There is an agreement to repay the entire amount of the loan in a total of seven installments till 2026.

Last on June 27, the IMF released $114.8 million in the third installment. However, according to the executed loan agreement in February last year, after discounting the first installment of 476.3 million dollars, the next six installments were supposed to receive 703.955 million dollars. However, due to the reserve crisis, Bangladesh proposed to increase the amount of the third and fourth installments to about 115 million dollars. The IMF approves it. As a result, there is a possibility of another discount of about 115 million dollars next December.

Bangladesh /KH