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IMF Team Raises Concerns Over Bangladesh as Reserves Decline Further

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IMF Bangladesh loan

The International Monetary Fund (IMF) has raised concerns regarding several key aspects of the Bangladesh economy, including inflation, growth, and foreign reserves, as it concluded its mission under the $4.7 billion loan program.

In a press release issued after the conclusion of the staff team visit on May 7, the IMF highlighted persistent inflationary pressures, increased volatility in global financial conditions, and a slowdown in major advanced trading partners as factors weighing on growth, foreign currency reserves, and the local currency, Taka.

The IMF has announced plans to conduct the first review of its Extended Credit Facility, Extended Fund Facility, and Resilience and Sustainability Facility arrangements later this year, according to the press release. Bangladesh is expected to witness a decline in reserves to $29.86 billion, the lowest level in seven years, as import bill payments for two months are due next week.

In April, exports experienced a significant decline of 16.5% to $3.95 billion compared to the previous year, mainly attributed to a slowdown in orders from clothing retailers. Additionally, inward remittances, which contribute to the country’s balance of payments, decreased by 16% year-on-year to $1.68 billion in April.

Bangladesh, during the visit of the IMF team from April 25 to May 7, highlighted plans for a more flexible exchange rate and reforms in banks’ lending rates. Starting in July, banks will be permitted to set their lending rates at a maximum of 3% above the six-month weighted average rates for Treasury bills. This new rate corridor, which replaces the previous 9% cap on lending rates, fulfills a key IMF condition.

In February, Bangladesh received the first installment of IMF loans amounting to $476 million, with the second tranche expected to be disbursed in November. The IMF’s ongoing review and engagement with Bangladesh reflect efforts to address the economic challenges faced by the country and promote sustainable growth in the future.

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FBCCI Urges Action Against Unscrupulous Traders

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FBCCI

The Market Monitoring Committee of FBCCI has urged the concerned market committees to be vigilant in preventing traders from engaging in dishonest practices to earn additional profits.

Md Amin Helaly, Senior Vice-President of FBCCI and Convener of the Market Monitoring Committee, issued this call during a meeting of FBCCI’s Market Monitoring Committee with local market committee leaders at Mohammadpur Town Hall Katcha Market in the capital on Wednesday.

Addressing the meeting as the chief guest, Helaly emphasized the importance of identifying and punishing dishonest businessmen and their associates.

He urged the collection of reports on dishonest traders and their submission to FBCCI, stating, “We will take stringent action against them in collaboration with the government.”

Helaly stated that FBCCI is closely monitoring the market to ensure stability during Ramadan, emphasizing the federation’s role in this regard as a representative of the private sector.

He remarked, “Our efforts will continue in coordination with various government agencies. However, consumers also need to adjust their purchasing habits. Market activities for a month should be more balanced than those on any single day.”

Directors of FBCCI and members of the Bazaar Monitoring Committee were also in attendance at the meeting.

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US Stresses Collaboration with Bangladesh on Key Issues: Blinken

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Blinken

US Secretary of State Antony Blinken extends congratulations to the people of Bangladesh on their Independence Day, March 26.

Blinken, on behalf of the United States, sends warm wishes to all Bangladeshis on this significant occasion.

In a statement, Blinken expresses the United States’ eagerness to bolster the partnership and people-to-people connections between the two nations in the coming year.

“The United States takes pride in collaborating with Bangladesh on various critical issues of today, including combating climate change, promoting economic development, addressing the Rohingya refugee crisis, supporting global peacekeeping efforts, and tackling global health challenges,” he remarks.

Highlighting the partnership’s role in ensuring a free, open, secure, and prosperous Indo-Pacific region, Blinken emphasizes its significance.

“As Bangladesh marks another year of independence, we reiterate our dedication to strengthening democratic governance and safeguarding human rights – endeavors crucial for Bangladesh’s continued prosperity,” he affirms.

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China-Bangladesh Friendship Strengthened, Notes President Xi Jinping

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Xi Jinping

Chinese President Xi Jinping has emphasized the robust and deep-rooted political trust between Bangladesh and China, along with their productive collaboration across various sectors, yielding tangible benefits for both nations.

Xi Jinping highlighted Bangladesh’s steadfast commitment to independence over the past 53 years, its efforts in economic development, and improvements in livelihoods, laying a strong foundation for the realization of the “Sonar Bangla” dream.

In celebration of Independence Day, Xi Jinping conveyed his congratulations to Bangladesh President Mohammed Shahabuddin through a letter.

He underscored the longstanding friendship between China and Bangladesh as traditional neighboring nations, noting its continual strengthening.

Xi Jinping expressed his keen interest in advancing the China-Bangladesh relationship and pledged cooperation with President Mohammed Shahabuddin to further enhance high-quality Belt and Road Cooperation and deepen the Strategic Partnership of Cooperation between the two countries.

Simultaneously, Chinese Premier of the State Council Li Qiang and Member of the Political Bureau of the CPC Central Committee and Foreign Minister Wang Yi extended separate congratulatory messages to Prime Minister Sheikh Hasina and Foreign Minister Hasan Mahmud respectively.

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