Prime Minister Sheikh Hasina has said the coronavirus pandemic and the Russia-Ukraine war have created fears of a negative impact on Bangladesh’s balance of payments.
Responding to questions from MPs in parliament on Wednesday, she noted Covid-19 and the war have slowed down global economic growth, disrupted the supply chain and led to a hike in the prices of fuel oil and other commodities along with freight charges in the international market.
Exports have also slowed down and incoming remittances have declined, she said, answering to Mashiur Rahman Ranga, the Jatiya Party MP from Rangpur-1, reports bdnews24.com.
The prime minister said her government achieved “remarkable success” in keeping the budget deficit and debt-to-GDP ratio at “sustainable and tolerable” levels for the past 14 years.
“We were able to keep the budget deficit within 5 per cent of GDP despite the coronavirus situation and global and domestic economic problems. The debt-to-GDP ratio has also been in the comfort zone,” she said.
After the end of 2021-22 fiscal year, the debt-to-GDP ratio stood at 34 per cent, which she said was well below the internationally recognised mark.
Hasina said her government took steps to increase remittances by easing rules and offering incentives.
Bangladesh Bank, as part of its efforts to keep the US dollar supply-demand gap, readjusted its value against the taka, she said. The central bank also sold $7.62 billion from the reserves to banks in 2021-22.
“Now less important government spendings are being reduced along with imports. The government is discouraging imports of luxury and unnecessary products while monitoring over-invoicing and under-invoicing.”
The prime minister said she “strongly” believes these steps will help improve balance of payments soon.
