IMF team visit Bangladesh to discuss budget, privatization of state-owned bank

The Daily Star, April 20, 2008
An International Monetary Fund (IMF) mission will arrive in Dhaka tomorrow to discuss with top government officials the next fiscal year’s national budget and banking reforms including fresh initiative for privatisation of the Rupali Bank.  

The IMF mission’s visit is followed by the IMF’s approval of an emergency assistance of $218 million to Bangladesh earlier this month.

Sources said the three-member IMF team, led by Adviser to the Asia Pacific Department of the IMF Thomas Rumbaugh, will hold meetings with the high-ups of the finance ministry, Bangladesh Bank and National Board of Revenue (NBR) during their stay till April 28.

“The IMF mission will discuss important issues regarding the next fiscal year’s budget as well as government subsidies in energy sector, including petroleum products,” said an official of the finance ministry. 

The team will have talks on the next phase of action by the government about three state-owned commercial banks — Sonali, Agrani and Janata — the official said, adding that the performance of the banks in 2007 after being corporatised is also on the agenda.

Sources said the mission will also prioritise the next course of action for privatisation of the Rupali Bank. After two years of negotiation, the government cancelled the process of selling the bank to Saudi Prince Bandar Bin Mohammed Bin Abdulrahman Al-Saud in March due to unresponsiveness of the bidder.

The IMF on April 2 approved the $218 million loan to Bangladesh to support its international reserve position, which has been under pressure in the face of sharp rise in disaster-related imports, including a large volume of food items.

Later, Finance Adviser Mirza Azizul Islam told journalists that the IMF approved the loan without imposing any condition. 

However, the acting Chair of the IMF Executive Board Takatoshi Kato in a press release on April 2 said, “The government [of Bangladesh] has indicated its intention to maintain macroeconomic stability and pursue important reforms in the areas of revenue administration and policy, expenditure management, energy pricing and state-bank reform.”


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