Prime Minister’s Adviser on Finance and Planning Prof Dr Rashed Al Mahmud Titumir on Thursday said that the International Monetary Fund (IMF), the World Bank and other development partners would support Bangladesh’s reform programmes in line with the country’s own priorities and strategies.
“For the first time, international development partners are clearly expressing their willingness to support reform initiatives based on Bangladesh’s priorities,” he said, adding that this would create scope for the country to pursue reforms in line with its own plans.
The adviser made the remarks while briefing journalists on the sidelines of the annual meetings of the IMF and the World Bank in Bangkok.
Titumir said that, besides the IMF and the World Bank, the Asian Development Bank (ADB), the Islamic Development Bank (IsDB) and relevant agencies of China and the United States were also extending cooperation in implementing reforms based on Bangladesh’s priorities.
Asked whether conditions attached to IMF loans could pose an obstacle, he said the issues would proceed through the established process. The government was working to implement each step quickly and effectively, and remained optimistic about taking effective measures in this regard.
On the IMF’s economic growth and inflation forecasts, the adviser said the projections should also be viewed in terms of the potential impact on the economy if the planned reforms were not implemented.
He said differences among forecasts by international organisations were normal, adding that a review of past data suggested that the IMF’s growth projections were generally somewhat conservative.
Referring to the IMF’s Article IV mission report, Titumir said Bangladesh’s growth forecast had been put at 4.7 percent. However, the government remained optimistic about achieving its budgetary growth target of 6.5 percent.
He said the reform agenda had been incorporated into the government’s election manifesto and would also be reflected in the forthcoming five-year economic strategy.
The government believed that implementing the planned reforms would strengthen the economy’s capacity, he added.
On inflation, Titumir said several factors were contributing to the persistent pressure on prices, including developments in the Middle East and long-standing inflationary pressures inherited from the past.
Reducing the cost of living for ordinary people and protecting vulnerable households remained key government priorities, he added.
The adviser acknowledged weaknesses in the previous social protection system, saying beneficiary selection had often been flawed.
“Many deserving people had been excluded, while others who were not entitled to benefits had been included. Fragmented implementation had also prevented the programmes from delivering their expected results,” he added.
Citing a World Bank report, he said deficiencies in effective social protection over recent years had contributed to rising poverty.
To address the situation, he said, the government was pursuing initiatives such as the Family Card and Farmers Card to improve beneficiary selection through scientific methods and ensure that assistance reached the intended recipients.
He said the government was also emphasising the development of digital public infrastructure to make social protection programmes more effective.
Development partners had responded positively to the government’s target of allocating five percent of GDP to the social sector and its plan to increase health spending, he said, adding that cooperation to support these priorities had also been discussed.
Titumir said the government aimed to raise tax collection to 10 percent of GDP by 2030. Restoring discipline in the banking sector, protecting depositors’ interests and ensuring accountability across the financial sector were also major priorities.
He said the government had taken initiatives to return deposits to customers of Sammilito Islami Bank to ensure the security of depositors’ money.
Measures would also be taken to improve transparency in banks’ financial statements and balance sheets and reform the necessary legal frameworks, he added.
Highlighting past financial irregularities, Titumir said common people were bearing a high cost due to the plundering of funds from banks and other sectors.
According to him, around US$40 billion had been looted from the banking sector.
He stressed that the money belonged to the people and those involved in financial irregularities and plundering must be held accountable.
He said both those who had siphoned off money and those who had facilitated such activities must face accountability, regardless of whether they were in Bangladesh or abroad.
A coordinated effort was needed to tackle defaulted loans and financial irregularities, he said, adding that holding those who assisted financial offenders accountable would help discourage similar crimes in the future.
The IMF and World Bank Group annual meetings are being held in Bangkok, Thailand, from October 12 to 18. The meetings are discussing a range of issues, including the global economic outlook, financial stability, poverty reduction and inclusive growth.
