Bangladesh to get next IMF loan instalment following April assessment

Bangladesh is set to receive the sixth instalment of its $5.5 billion IMF loan after an assessment mission visits in April to evaluate macroeconomic performance, financial sector reforms, and progress against agreed benchmarks.

Chris Papageorgiou, the head of the IMF mission in Bangladesh, confirmed the development after a meeting with Bangladesh Bank Governor Mostaqur Rahman at the central bank headquarters on Wednesday.

The IMF's spring meetings will be held in April, followed by a team’s visit to Bangladesh, he said.

The remaining amount will be discussed during the visit, with June as likely for its release.

Bangladesh Bank is preparing for the IMF team’s visit, slated to visit in the second week of April.

Also on Tuesday, the IMF in a meeting with the central bank chief demanded a detailed roadmap from the BNP government, seeking clarity on how it plans to implement and sustain the financial sector reforms initiated by the interim government.

As a follow-up, the IMF mission chief visited the Bangladesh Bank headquarters on Wednesday to discuss the preparation and timing of different stages of implementation of the proposed roadmap.

Papageorgiou expressed satisfaction with the current status of Bangladesh's financial sector reforms, but emphasised the need to make the process more structured and time-bound.

The central bank’s Financial Stability Department, which is tasked with the reforms, briefed the IMF team about the reform measures taken and the stages of implementation.

“The IMF expressed satisfaction with the country's reserve growth, foreign exchange rate and progress in overall financial sector reforms,” said Mohammad Shahriar Siddiqui, director of the department.

“They've called for a written time-bound roadmap, which Bangladesh Bank has already started working on. The organisation is also looking positively at the progress in increasing reserves, achieving market-based exchange rates and fulfilling different benchmarks,” Shahriar said.

After several rounds of negotiations since 2022, Bangladesh signed a $4.7 billion loan agreement with the IMF in early 2023 to address financial crisis.

The loan size was increased to $5.5 billion during the last disbursement in June last year.

Bangladesh has so far received $3.64 billion across five tranches.