Govt-WB talks on $100m budgetary support begin
Tuesday, 18 December 2007
FE Report
The government Monday started negotiations with the World Bank (WB) for $100 million budgetary support fund that the latter offered in the wake of successive floods and devastating cyclone in recent months.
Negotiations began Monday at the Economic Relations Division (ERD) in Dhaka, sources said.
In the event of successful negotiations that are expected to be completed today (Tuesday), the government will receive the budgetary support fund by early January next year.
The fund will be used to recover the losses and damage caused by the cyclone Sidr and to help minimise the pressures on the budget for meeting the import costs of additional food grains, petroleum and other commodities, the sources told the FE.
"We expect that the $100 million assistance from the global lender will be disbursed next month to meet the immediate needs of the country for overcoming the budgetary pressure in the aftermath of floods and cyclone," a senior ERD official said.
Meanwhile, Vice-President of the WB Praful C Patel during a recent visit in Bangladesh predicted that the international price shocks alone are likely to have adverse impact on the Bangladesh's economy this year to the tune of $1.6 billion, which is equal to 2.3 percent of total gross domestic product (GDP). Moreover, in the absence of any domestic price adjustments, rising international oil and fertiliser prices are putting an additional fiscal burden on the current year's budget, he felt.
Earlier, in a quick response after the cyclone on November 15, the global lender offered up to US$ 250 million assistance to cover immediate, mid-term and long-term needs. The first part of this assistance strategy is a quick-disbursement $100 million budget support operation.
Besides, the WB will give $25 million for livelihood restoration support that will be made available by April next year and $125 million for supporting the long-term vision of disaster prevention and management articulated by the Chief Advisor recently.
The government Monday started negotiations with the World Bank (WB) for $100 million budgetary support fund that the latter offered in the wake of successive floods and devastating cyclone in recent months.
Negotiations began Monday at the Economic Relations Division (ERD) in Dhaka, sources said.
In the event of successful negotiations that are expected to be completed today (Tuesday), the government will receive the budgetary support fund by early January next year.
The fund will be used to recover the losses and damage caused by the cyclone Sidr and to help minimise the pressures on the budget for meeting the import costs of additional food grains, petroleum and other commodities, the sources told the FE.
"We expect that the $100 million assistance from the global lender will be disbursed next month to meet the immediate needs of the country for overcoming the budgetary pressure in the aftermath of floods and cyclone," a senior ERD official said.
Meanwhile, Vice-President of the WB Praful C Patel during a recent visit in Bangladesh predicted that the international price shocks alone are likely to have adverse impact on the Bangladesh's economy this year to the tune of $1.6 billion, which is equal to 2.3 percent of total gross domestic product (GDP). Moreover, in the absence of any domestic price adjustments, rising international oil and fertiliser prices are putting an additional fiscal burden on the current year's budget, he felt.
Earlier, in a quick response after the cyclone on November 15, the global lender offered up to US$ 250 million assistance to cover immediate, mid-term and long-term needs. The first part of this assistance strategy is a quick-disbursement $100 million budget support operation.
Besides, the WB will give $25 million for livelihood restoration support that will be made available by April next year and $125 million for supporting the long-term vision of disaster prevention and management articulated by the Chief Advisor recently.