IMF lauds Bangladesh's efforts to overcome economic challenges

The International Monetary Fund (IMF) has praised Bangladesh's measures, taken by the interim government, to overcome economic challenges due to the recent turbulence and major floods.

"In response to the challenging circumstances, the authorities' efforts to initiate adjustments, including continued monetary tightening and rationalizing non-priority capital spending are commendable," IMF Mission Chief for Bangladesh Chris Papageorgiou told BSS.

The IMF mission team led by him visited Dhaka during September 24-30 to discuss recent developments and the authorities' reform priorities.

Papageorgiou said the timely formation of an interim government helped stabilize the political and security conditions, alongside a gradual return to normalcy in the economy.

"Nonetheless, economic activity has slowed markedly, while inflation remains at double-digit levels, owing to the recent turbulence and major floods. The deterioration in the balance of payments, reflecting outflows in trade credit, has put additional pressure on foreign exchange reserves," he mentioned.

However, what the government has taken to improve the economic issues is really praising, he added.

Responding to a question on the past government fiscal target, Papageorgiou informed that the authorities' budget has been perceived as aspirational, with optimistic tax revenue and ambitious capital spending projections.