Economy
Bangladesh Eyes Record Remittance in May
Bangladesh is on track to receive a record-high remittance in May, thanks largely to the depreciation of the local currency against the US dollar, central bankers say, expressing optimism despite concerns over foreign exchange reserves.
The country, grappling with multiple economic challenges and a persistent shortage of foreign currencies, has already received $2.143 billion in the first 29 days of May. This amount marks a 38-percent increase compared to the same period last year when remittance stood at $1.553 billion.
The remittance received in these 29 days is also higher than the totals for the previous two months, with April at $2.044 billion and March at $1.997 billion. The Bangladesh Bank is hopeful that the total inflow for May will set a new record once the earnings from the remaining two days (May 30 and May 31) are added.
“The monthly remittance will set a new record of earning in recent years once the earnings of the remaining two days are added up,” said a source from the Bangladesh Bank.
As of May 29, the total remittance earnings for the fiscal year 2024 have reached $21.261 billion, which is more than 95 percent of the $21.61 billion earned in the entire fiscal year 2023.
A Bangladesh Bank official, speaking anonymously, noted that remitters usually send more money ahead of religious festivals like Eid. However, the recent 5.98-percent devaluation of the Bangladeshi taka against the US dollar likely encouraged more transfers ahead of Eid-ul-Azha.
“I think the May remittance inflow would set a new record in recent years, which would be a great relief under the current macroeconomic context,” the central banker added.
The country’s rapidly depleting foreign exchange reserves have become a serious concern for the $460 billion-plus economy. Bangladesh faces difficulties in meeting the net international reserves (NIR) target set by the International Monetary Fund (IMF) as part of a $4.7-billion lending package aimed at restoring macroeconomic stability.
On May 8, the central bank’s monetary policy committee (MPC) made a significant decision to raise the exchange rate to Tk 117 from Tk 110 to stabilize the forex market. This revision caused the local currency to depreciate by 5.98 percent per dollar, allowing dollar holders to gain more from their foreign currencies.
As of May 29, Bangladesh’s gross foreign exchange reserves stood at $24.22 billion, according to the Bangladesh Bank. However, the IMF, using a different methodology (BPM6), reports the reserves at $18.72 billion for the same date.
Expatriate Bangladeshis sent approximately US$ 2.11 billion in remittances during the first 28 days of September in the fiscal year 2024-25, according to data released by Bangladesh Bank on 29 September.
Of this total, state-owned and specialised banks handled $679.10 million, while private banks received $1.43 billion in remittances.
Chief Adviser to Bangladesh’s interim government, Professor Muhammad Yunus, has vowed to expedite reforms and hold elections swiftly. Yunus, who recently assumed the role after the collapse of Prime Minister Sheikh Hasina’s 15-year administration, expressed his commitment during an interview with Tokyo-based news outlet NHK WORLD in New York on Sunday. He was attending the United Nations General Assembly at the time.
Following mass student-led protests that ended Hasina’s long-standing rule in August, Yunus stepped in as the leader of the caretaker government. Known for founding Grameen Bank, an institution providing microloans to the underprivileged, Yunus, along with the bank, earned the Nobel Peace Prize in 2006 for his efforts in poverty alleviation.
During the interview, Yunus emphasized that the interim government’s primary mission is to implement reforms promptly and ensure elections are held as soon as the groundwork is complete. He underscored the importance of success, stating, “Failure is not something that we can accept.”
Addressing the pivotal role of students in the ousting of the Hasina administration, Yunus acknowledged the sacrifices made by young people, referring to their involvement as part of a “revolution.” He highlighted his intention to engage the younger generation in shaping policy.
Furthermore, Yunus called for continued support from Japan, Bangladesh’s largest donor, during this crucial transition period. He stressed that Japan’s assistance is vital to stabilizing Bangladesh’s economy and fostering a democratic foundation in the nation.
Syeda Rizwana Hasan, the Adviser for Environment, Forests, and Climate Change, announced today that steps will be taken to restrict the use of polythene shopping bags to safeguard future generations.
Starting from October 1, polythene bags will be banned in shopping malls, followed by a ban in kitchen markets from November 1.
“Everyone must take responsibility and stop using polythene voluntarily. Action against polythene producers will begin from November 1,” Rizwana Hasan stated during a seminar.
The Department of Environment (DoE) organized the seminar to raise public awareness about alternatives to banned polythene bags.
Rizwana Hasan highlighted that the restriction on polythene will be executed in phases according to legal provisions, and discussions with shopping centers and store owners are ongoing to ensure a smooth transition.
She also announced plans to make the government secretariat a plastic-free zone by December.
Other speakers at the seminar included Environment Secretary Dr. Farhina Ahmed, DoE Director General Dr. Abdul Hamid, Director Rajinara Begum, President of the Shop Owners Association Muhammad Helal Uddin, and Md. Arifur Rahman Bhuiyan, Assistant Professor of Environmental Science at BUP. They discussed the harmful effects of polythene and the need for alternative products.
Earlier, Rizwana Hasan inaugurated a fair showcasing eco-friendly alternatives to polythene bags and visited 24 stalls. The fair featured products from government and private entrepreneurs, including reusable bags, jute bags, paper bags, and items made from bamboo and cane.
