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LDC graduation challenges

Muhith warns of losing soft loan facility, rise in debts

FE Report | March 22, 2018 00:00:00

Finance Minister A M A Muhith on Wednesday warned all of some impending challenges, including losing concessional loan facility and increase in debt as the country has earned eligibility, preliminarily, for graduating to a middle-income country.

"From now on no loan will be available, everything will be debt. When we take debt, we have to be careful, so that we do not sink into quicksand."

The minister said these while briefing newsmen at his secretariat office on the eve of Bangladesh's becoming eligible to graduate to a developing country.

"We have to change our mentality. The facilities we avail from various sources have to sacrifice. We have to keep in mind that we are no longer a least developed country (LDC)."

Mr Muhith said these will have to be reflected in outlook and policies of the country.

"We have already started taking steps in this regard. We are taking scale-up facility (high interest loan) from Japan during the last couple of years as part of our adjustment process."

On the other hand, while listing benefits of the graduation, the finance minister said: "We will enjoy equal benefits that the other countries get as developing nations. So, it is not correct that we will be deprived of facilities."

"We will feel a psychological boost that we are no longer beggar," said Mr Muhith.

Replying to a query, why the government is celebrating the occasion when Bangladesh has only received the preliminary recognition on way to graduation, the minister said, "We are globally known as a poor country. I am the worst sufferer of the stigma, as I have to go from door to door for money. But the situation is now totally reverse."

"Personally I feel so proud. We are deliberately taking scale-up facility of World Bank to show that we can achieve. We were at the lower end, but now have climbed up. We will go further up."

"It's really a matter of great pride. Why won't we celebrate it?"

Mr Muhith said Bangladesh has proved its capability by meeting all the three criterions for graduating to a developing country. He said Bangladesh is the only country that is graduating by meeting the necessary criterions, which no other LDC has been able to attain at this stage. Some could meet one or two criterions, thus their graduation is getting delayed.

Replying to a query, the minister, however, said Bangladesh will remain a LDC until 2024 in the United Nations' list. But the country has already graduated to a lower middle income country as per the World Bank's calculation.

On another query, Mr Muhith said the country's export earnings will not decrease due to the graduation.

Asked whether Bangladesh will turn into a donor country for the poor nations, the minister said that is not possible before 2041. State minister for finance and planning M A Mannan, chief coordinator for sustainable development goals (SDG) affairs in Prime Minister's Office (PMO) Abul Kalam Azad, principal secretary to PMO Nojibur Rahman, and Economic Relations Division (ERD) secretary Kazi Shofiqul Azam and additional secretary Monwar Ahmed also spoke, among others, on the occasion.

Meanwhile, Mr Muhith congratulated local electronics goods manufacturer Walton Group for its debut in exporting Bangladesh-made laptop computers to Nigeria.

He praised the local manufacturer at a deal-signing ceremony in this regard at finance ministry's conference room on Wednesday. Walton Digi-Tech Industries Ltd chairman S M Rezaul Alam and director of Western Base Nigeria Ltd David Nwune signed the deal on behalf of their respective companies.

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