The International Monetary Fund on Friday said it was sending a staff mission to Bangladesh from Oct 26 to Nov 9 for initial discussions on economic and financial reforms, with an eye to a future lending programme and access to a new longer-term IMF facility.
Led by Rahul Anand, IMF mission chief to Bangladesh, the team will stay in Bangladesh from Oct 26 to Nov 9, the IMF said in a statement on Friday, reports bdews24.com.
The objective of the mission is to make progress towards a staff-level agreement on a prospective Extended Credit Facility or Extended Fund Facility programme, and access under the newly created Resilience and Sustainability Facility, or RSF, in the coming months.
The RSF aims to provide affordable, long-term financing to help build resilience against climate risks in countries highly vulnerable to climate change, such as Bangladesh, according to the statement.
IMF staff would also continue the engagement with other stakeholders during the visit.
This is the first mission and programme discussions could continue over the coming months.
Bangladesh Bank Governor Abdur Rouf Talukder earlier this week sat with top officials of the IMF and the World Bank in Washington, DC to discuss Dhaka’s request to get $5.5 billion in total in loans over the next three years.
Rouf said he met an IMF vice-president to discuss at length the country’s request to get $4.5 billion over the next three years, as he sought to iron out the details on behalf of the government before official negotiations begin in Dhaka next week.
According to Dhaka’s proposed credit request schedule, Bangladesh has requested $1.5 billion annually over the next three fiscal years under the global lender’s new RSF programme.
Anne-Marie Gulde, deputy director of the Asia and Pacific Department at the IMF, said the global lender is ready to start negotiations with Dhaka.
“We are preparing for initial negotiations with Bangladesh, scheduled to kick off next week,” she said at a briefing on Sunday.
Member countries have access to loans from the IMF under three programmes - Extended Credit Facilities, or ECF, Extended Fund Facility, or EFF and RSF to address climate change impacts.
Reuters earlier reported Bangladesh will need a regular IMF-supported programme such as a stand-by agreement or an extended fund facility to be able to get this new type of financing. RSF funds are capped at 150 percent of a country's quota or, in Bangladesh's case, the maximum of $1 billion.
According to Rouf, Bangladesh can take up to $7 billion in loans in total from the IMF facilities.
He said Bangladesh sought loans for budget support to get the funds quickly because the IMF clears these funds at a time while funds for projects are cleared gradually. Rouf believes the loans from the IMF will help Bangladesh tackle the ongoing shortage of dollars.
