David Cowen

The chief of the visiting International Monetary Fund (IMF) mission, David Cowen, said Thursday the mission and the Bangladesh authorities reached an ad referendum understanding on a set of economic policies and reforms, focusing on pursuing sound fiscal and debt management, ensuring stable monetary and exchange rate conditions as well as strengthening the financial sector.

Mr. Cowen said the ad referendum understanding is subject to review by the IMF management and its Executive Board in the context of the first review under the ECF (Extended Credit Facility) arrangement.

"Upon the Executive Board's completion of this review, which is expected in January next, SDR (special drawing rights) 91.4 million or about US$ 141 million would be made available to Bangladesh," Mr Cowen added.

He said this at a press briefing at the conference room of the ministry of finance (MoF) on conclusion of the visit of the IMF mission on the first review under the ECF arrangement with Bangladesh.

In April last, IMF approved nearly US$1.0 billion ECF for Bangladesh to provide support to the country to maintain a healthy balance of payment (BoP) situation.

The Washington-based International Monetary Fund (IMF) team visited Bangladesh since Necember 27 and met with all relevant ministries, advisers and other officials concerned.

Mr Cowen said IMF reached an ad referendum, for a synergy of actions to maintain macroeconomic stability, build external buffers, and promote higher growth in the country.

"The government has agreed to contain its budget deficit (excluding grants) to 4.5 per cent of gross domestic product (GDP) in the current fiscal year, including the settlement of fertiliser subsidy overruns from FY 12, with moderate consolidation over the medium term," according to a press statement issued by the IMF.

Under the ECF arrangement, the performance of the Bangladesh in relevant areas has so far been generally sound, he added.

"Quantitative targets are broadly on track, with all performance criteria met at end June 2012 -- the first test date under the ECF."

News: The Daily Financial Express/Bangladesh/7th-Dec-12