IMF engages with Bangladesh on reforms, new programme

In a statement issued today from Washington DC, IMF Mission Chief for Bangladesh Ivo Krznar said IMF staffs are actively engaging with the authorities as part of the Fund's consideration of possible next steps regarding a successor programme.

“The Bangladeshi authorities have requested a new IMF financial arrangement to support their economic reform program. IMF staffs are engaging with the authorities on their reform agenda and policy priorities as part of the Fund's consideration of possible next steps," he said.

He noted that Bangladesh's existing arrangements under the Extended Credit Facility (ECF), Extended Fund Facility (EFF), and Resilience and Sustainability Facility (RSF) have served as an important policy anchor during a challenging period.

However, he observed that the country's macroeconomic and political landscape has changed significantly since the current IMF-supported program was approved in January 2023. 

“The authorities now face a more complex set of challenges. Banking-sector weaknesses and low revenue mobilization underscore the need for a renewed and sustained reform effort,” he added.

He mentioned that the authorities’ request for a successor arrangement provides an opportunity for the Fund and the authorities to agree on a potential programme that both reflects the current challenges and incorporates the new authorities’ objectives and priorities, reports BSS.

“Any new arrangement would need to be based on Bangladesh’s balance-of-payments needs and strong policy commitments anchored by a credible reform agenda, and would be subject to the IMF’s policies and Executive Board approval,” he added.

“Planning is underway for a staff visit to Bangladesh, which would allow IMF staff to take stock of recent economic developments, engage with the authorities on their policy priorities, and assess the outlook and reform challenges. Discussions about the parameters of a potential new IMF-supported program—including its size and related reform commitments—would take place in the context of a subsequent program negotiation mission,” he said.

“The IMF remains a committed partner to Bangladesh in its efforts to secure lasting macroeconomic and financial stability, strengthen resilience, and support strong, inclusive growth. We look forward to constructive engagement with the authorities and other stakeholders as this process moves forward,” he added.