Govt won't sign any treaty with IMF that undercuts nat'l interest: Adviser

FE Team | Published: September 09, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

"I will not accept any condition that clashes with the interest of the country," said Adviser for Finance and Planning AB Mirza Azizul Islam after a meeting with the visiting IMF delegation at his Planning Commission office in the city Saturday, reports UNB.
"The government must not enter into any treaty with the International Monetary Fund (IMF) that undercuts national interest, no matter what amount of money the international funding agency offers to lend," the adviser said.
The IMF mission is in the city at a time when the donor agency is touting an umbrella deal for providing policy support, although there have been criticisms about such deals as the critics think this could bind the country to policy dictates.
Responding to questions from journalists about the much-talked-about Policy Support Instruments (PSI) treaty proposed by the IMF, he said still there has not been any discussion about the so-called PSI treaty.
"But I can ensure you that I will not take any money, whatever the amount, giving away the interest of the country", he added.
But, after the meeting, IMF Asia-Pacific Department Adviser Thomas R Rumbaugh said his organisation has many aspects, avenues and options to help Bangladesh, and they are interested to tie themselves up under a treaty with Bangladesh.
"There are several options. The PSI is one of the options, while PRGF is another. But it depends on the government of Bangladesh under which treaty they want it", he said.
The finance adviser made it clear that the government would not refuse any budgetary support from any donor organisations or countries unless they tag any impossible condition binding the aid package.
Defending his stance on taking budgetary supports, he said that the government could tackle the relief activities with its domestic resources, but the post-flood rehabilitation programme would need external support.
"Different ministries are yet to send their post-flood demands. When it will start to come, we will need budgetary support then."
When his attention was drawn to some countries having said goodbye to the IMF for its policy advocacy that has allegedly done more harm than good to them, he said that getting out from the grip of IMF depends on the type of assistance needed.
"Many countries again enter in the IMF after they get out", he said, apparently disapproving of such suggestion.
To a query whether it needs to enter into any treaty with the IMF for money when the Balance-of-Payments (BoP) situation is good, he said it does not mean entering into a new treaty, it means to get budgetary supports.
"BoP and budgetary support are totally different issues-BoP is the part of remittance, it is not part of the government."
He also refused to have any link with the closing down of jute mills and signing treaty with the IMF, the twin of the World Bank that has sponsored drastic reforms and denationalisation of state-owned enterprises, which involves layoffs and retrenchments.
About the discussion points with the IMF, Aziz said that they discussed revenue reform, income-tax law, reform in revenue management, revenue collection, inflation and financial-sector reform.
About the IMF's proposal for separating revenue-policy body and collecting body, he said, "I agreed with it and once upon a time it was separate in the country. But we have some administrative issues to do that."
The adviser said that the IMF delegation appreciated his government's effort to increase the revenue collection and reform initiative for the financial sector.