Ratings to 'raise BD's acceptability in global financial market'

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Siddique Islam
The sovereign credit ratings that have been assigned by international agencies for Bangladesh will raise the country's acceptability in the global financial market, a Standard Chartered Bank (SCB), Bangladesh senior official said Tuesday.
"Both the ratings are positive indicators for the government as a borrower as well as an investment destination," Alamgir Morshed, Director, Head of Global Markets of Standard Chartered Bank (SCB), Bangladesh, told the FE in an exclusive interview.
Moody's Investors Service, a U.S. based credit rating agency, announced on Monday its sovereign credit rating for Bangladesh as Ba3 Monday, a week after Standard & Poor's (S&P's) granted the country a sovereign credit rating of BB- on April 6.
Mr. Alamgir also said the sovereign credit ratings will create a benchmark for receiving foreign funds by the government as well as private sector.
"The country's business community will be benefited from the sovereign ratings because it reflect good governance, sound micro-economic policy and conducive environment for foreign direct investment (FDI)," the SCB senior official noted.
The sovereign credit ratings will give an assessment of the government's ability and willingness to repay its local and foreign currency debts, he said, adding that both quantitative and qualitative factors have been considered in deriving the sovereign ratings.
"In the global financial arena the BB- and Ba3 sovereign credit ratings put Bangladesh at a position higher than Pakistan and Sri Lanka and in the same category of countries like Vietnam, the Philippines, Indonesia and Turkey," Mr. Alamgir added.
Promoting Bangladesh is a common agenda for all of us, the SCB official said, adding that Bangladesh was misunderstood. "It has huge potentials but in the international arena it is a country not talked about."
The SCB official, however, said the ratings are not enough for building a nation, which must improve infrastructural facilities including power and energy to attract investments from both local and abroad.
"Ratings are important factor, but not the only factor. Now, there is lots of interest there, we need to build on it," Mr. Alamgir said, adding that authorities concerned would have to work continuously to improve the country's rating position.
Both the rating agencies pointed to the constraints of economy, deficiencies in energy and infrastructure, difficulty in operating environment and perennially low FDI.
Moody's also highlighted the need for export diversification and over reliance on the readymade garment (RMG) sector, ideological politics, banking system weakness and government's ability or dependence on borrowing from the local debt market where the cost is high.