BB hopes IMF to approve second tranche loan of $681m on Dec 11

Bangladesh Bank (BB) is optimistic that the second tranche of the US$4.7 billion IMF loan, which amounts to $681 million, will be approved by the international money lender during its board meeting on 11 December.

“The two sides have reached an agreement. For this, we hope the IMF’s board meeting on December 11 will approve the second installment of the loan,” said BB Spokesperson Mezbaul Haque at a press briefing following a meeting with the visiting review team from the IMF at the central bank headquarters in the city.

He informed that Bangladesh has already met several conditions set by the IMF.

BB today sat with the IMF review team for a meeting chaired by central bank Governor Abdur Rouf Talukder at 10 am. The discussion ended around 11 am.

The review team came to Bangladesh on Oct 4 to check the progress and use of the first tranche of the $4.7 billion loan deal under Article IV of the IMF agreement.

Following the meeting, Mezbaul Haque said the IMF team was satisfied with Bangladesh’s attempts at structural reform and added that he expected the second tranche of the loans in December.

Of the six conditions set out by the IMF for the loan, Bangladesh has been able to fulfill four. The IMF is not adding any further conditions to the second tranche.

These conditions included a single exchange rate based on the market, modernisation of monetary policy, information disclosure on risk-based assets, IMF measures on the foreign exchange accounts and raising them to a certain level, and market-based tax revenue collection and interest rates, Haque said.

Bangladesh was unable to meet the conditions on reserves and revenue collection, he said.

“We have explained the situation, what steps have been taken and are continued efforts. They have been reassured by this,” he added.

Efforts would be made to bring inflation down to 8 percent by December, he said.