Recession results in less aid flow to Bangladesh
Sunday, 14 December 2008
FHM Humayan Kabir
The aid flow to Bangladesh from the bilateral donors has shrunk a lot as the donor countries are busy to weather their economic plunge in recent months, officials said.
"The global economic recession has hit most of the developed countries resulting in less aid flow to Bangladesh," a senior official of Economic Relations Division (ERD) told the FE.
In the first quarter of the current financial year (2008-09), Bangladesh received only US$ 33.7 million worth of aid from three bilateral donors, he said.
Out of the received aid, British donor agency Department for International Development (DFID) disbursed $26.73 million worth of grant, Germany $3.47 million grant and Japan $3.51 million loan.
In the corresponding period of the last fiscal, the bilateral donors disbursed $157.24 million grants and loans to Bangladesh government.
"Though the aid disbursement from bilateral donors has declined to some extent, it is difficult to comment at this moment whether the plunge has affected the aid flow. We've to wait for another couple of months to assess the impact," said ERD Secretary Musharraf Hossain Bhuiyan.
"We are observing the global situation closely. We are hopeful our external resources target would not be affected much even during the global financial dip," he told the FE.
Due to global recession the multilateral donors including the World Bank (WB), the Asian Development Bank (ADB) and the United Nations are trying to increase their capital to assist poor and developing countries so that they are not adversely affected by the global financial meltdown.
Washington-based global lender WB has already announced a US$2.0 billion package for the poor and developing countries, which will be disabused as grant or interest-free loan.
"As the Bangladesh's major bilateral donors including Japan, the UK and the USA have already faced financial meltdown, their aid commitment and disbursement have been affected a lot," an ERD official said.
Some of Bangladesh's important multilateral donors like United Nations (UN), Islamic Development Bank, European Commission (EC) and World Food Programme (WFP) have also not disbursed any aid during July-September period of the current fiscal (2008-'09).
However, most of them disbursed assistance to the government in the corresponding period of the last fiscal (2007-'08).
Since the donor countries are resorting to reducing their financial support to the donor agencies for saving their economy from the financial turmoil, the multilateral donors are unable to come forward like previous days with aid, the official said.
Cyclone-ravaged Bangladesh has set an ambitious foreign aid receiving target of Tk 178.03 billion (US$2.58 billion) in its current Tk999.62 billion national budget.
The country will require Tk 256.0 billion ($3.71 billion) for developing its infrastructure where Tk 145.9 billion ($2.11 billion) has been targeted to be received from the external resources.
The government in the last FY08 received about $2.0 billion worth of aid from different donor countries and agencies, record high in the history of Bangladesh.
The aid flow to Bangladesh from the bilateral donors has shrunk a lot as the donor countries are busy to weather their economic plunge in recent months, officials said.
"The global economic recession has hit most of the developed countries resulting in less aid flow to Bangladesh," a senior official of Economic Relations Division (ERD) told the FE.
In the first quarter of the current financial year (2008-09), Bangladesh received only US$ 33.7 million worth of aid from three bilateral donors, he said.
Out of the received aid, British donor agency Department for International Development (DFID) disbursed $26.73 million worth of grant, Germany $3.47 million grant and Japan $3.51 million loan.
In the corresponding period of the last fiscal, the bilateral donors disbursed $157.24 million grants and loans to Bangladesh government.
"Though the aid disbursement from bilateral donors has declined to some extent, it is difficult to comment at this moment whether the plunge has affected the aid flow. We've to wait for another couple of months to assess the impact," said ERD Secretary Musharraf Hossain Bhuiyan.
"We are observing the global situation closely. We are hopeful our external resources target would not be affected much even during the global financial dip," he told the FE.
Due to global recession the multilateral donors including the World Bank (WB), the Asian Development Bank (ADB) and the United Nations are trying to increase their capital to assist poor and developing countries so that they are not adversely affected by the global financial meltdown.
Washington-based global lender WB has already announced a US$2.0 billion package for the poor and developing countries, which will be disabused as grant or interest-free loan.
"As the Bangladesh's major bilateral donors including Japan, the UK and the USA have already faced financial meltdown, their aid commitment and disbursement have been affected a lot," an ERD official said.
Some of Bangladesh's important multilateral donors like United Nations (UN), Islamic Development Bank, European Commission (EC) and World Food Programme (WFP) have also not disbursed any aid during July-September period of the current fiscal (2008-'09).
However, most of them disbursed assistance to the government in the corresponding period of the last fiscal (2007-'08).
Since the donor countries are resorting to reducing their financial support to the donor agencies for saving their economy from the financial turmoil, the multilateral donors are unable to come forward like previous days with aid, the official said.
Cyclone-ravaged Bangladesh has set an ambitious foreign aid receiving target of Tk 178.03 billion (US$2.58 billion) in its current Tk999.62 billion national budget.
The country will require Tk 256.0 billion ($3.71 billion) for developing its infrastructure where Tk 145.9 billion ($2.11 billion) has been targeted to be received from the external resources.
The government in the last FY08 received about $2.0 billion worth of aid from different donor countries and agencies, record high in the history of Bangladesh.