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

The China Development Bank (CDB) and Russia's Sberbank signed an agreement here yesterday, with the aim of pushing forward financial cooperation between the two countries.

The signing ceremony took place on the sidelines of the 16th meeting of the Joint Commission for the Regular Meetings of Heads of Government of China and Russia, which was co-chaired by Chinese Vice Premier Wang Qishan and Russian Deputy Prime Minister Dmitry Rogozin.

Under the accord, which has a five-year validity, CDB and Sberbank will cooperate in such fields as Russia's large-scale government projects and infrastructure projects, international settlement and trade financing, correspondent banking, custody services, personnel training and experience exchanges, with a total volume of cooperation less than 2 billion U.S. dollars. The agreement has given priority to Chinese-funded projects in the areas of infrastructure, oil and gas, metal mining, electricity, telecommunications, agriculture and forestry.

The two banks will cooperate through such methods as comprehensive credit line, syndicated loans, finance lease and investment banking services.

News: The Daily Sun/Bangladesh/7th-Dec-12

Asif Ibrahim, second from right, outgoing president of Dhaka Chamber of Commerce and Industry (DCCI); speaks at the conclusion of a conference on "Positioning Bangladesh: branding for business" at Sonargaon Hotel in Dhaka yesterday. AKM Fahim Mashroor, president of BASIS; MA Sabur Khan, newly elected president of DCCI; and Tanjil Chowdhury, vice-chairman of Prime Bank; were also present.

Bangladesh should go for an integrated branding policy, instead of taking piecemeal steps, as the country is at the crossroads towards higher growth trajectory.

The call came at the conclusion of a two-day international conference on Positioning Bangladesh: Branding for Business at Sonargaon Hotel in Dhaka yesterday.

“Brand is not just a logo. There must be concerted efforts from public and private sectors to articulate a proper branding strategy,” according to the recommendations of the conference.

Bangladesh should mitigate the consequences and try to adapt to the new scenario arising out of climate change, to brand itself to the world.

More than 30 such recommendations came up from seven working sessions of the conference, organised by Dhaka Chamber of Commerce of Industry, in association with BUILD, Katalyst and BASIS.

Business Initiatives Leading Development (BUILD) works as the government's key strategic partner in private sector development, while Katalyst is a market development project. Bangladesh Association of Software and Information Services (BASIS) is the national trade body for software and IT-enabled services.

Asif Ibrahim, the outgoing president of the Dhaka Chamber, said Bangladesh is now at a crossroads and the outcomes of the event will help the country change its perception and reposition itself in the world.

Ferdous Ara Begum, chief executive officer of BUILD, Tanjil Chowdhury, vice-chairman of Prime Bank, Sabur A Khan, the newly elected president of the DCCI, and Farida Husain, communications director of Katalyst, also spoke.

“The country should fully exploit the young, dynamic, hard-working and entrepreneurial labour force, which is seen as the biggest resource to take the economy to the desired destination,” according to a recommendation of the event.

Investment in branding the nation must be long-term and the effect must be lasting throughout numerous channels.

"The brand must be built on this premise engaging the government, businesses and individuals to gain further credibility,” according to the conference outcomes.

The development of a fully integrated branding strategy can also help position Bangladesh as a destination for ICT investment and outsourcing, and attract foreign direct investment.

Bangladesh should review the wages annually, take proper safety measures, generate efficient mid-level management, become more dependent on domestic management experts and improve infrastructure to attract more investment.

“There is a dire need to implement the multimodal transport policy to improve the transport facilities and reduce the cost of business.”

As per the suggestions, cost of energy should be kept lower to sustain competitiveness.

The ICT sector can be considered a thrust sector due to its rapid expansion and growing contribution to the economy.

“Bangladesh should focus on IT and IT-enabled services. Policies should be auspicious to encourage this competitive sector,” according to the recommendations. Tariff policies should gradually be liberalised to bring the private sector-led economic growth into a reality.

“There should be exclusive interaction and coordination between Bangladesh Tariff Commission and the National Board of Revenue prior to finalising the annual national budget.”

Policymakers should give special attention to counter-productive policies. The mismatch between macro and micro policies exists all over the world. However, the mismatch should be within an acceptable limit, the recommendations said.

“In order to get the desired benefits of macro and micro policies, coherent and consistent policies should be devised and enacted in an orderly fashion.”

Crop insurance should be introduced to save farmers in grey days, according to the recommendations of the conference.

News: The Daily Star/Bangladesh/7th-Dec-12

International Monetary Fund yesterday said it may release the second instalment -- $141 million -- of its $1 billion loans by January.

But before that, the board and management of the lender will have to agree with the understandings between the government and an IMF team on the conditions tagged with the loan promise.

The IMF mission wrapped up its 10-day visit to Dhaka yesterday.

The chief of the team, David Cowen, in a statement said: “Performance so far has been generally sound. Quantitative targets are broadly on track, with all performance criteria met at end-June 2012.”

After a meeting at the Finance Division, Cowen at a press conference said, “Progress has also been made on structural measures, notwithstanding additional time needed to build policy consensus and several key reforms.”

He also said the government will pursue legal and prudential reforms to strengthening financial sector governance and oversight, and reinforce Bangladesh Bank's supervisory mandate and capacity.

Cowen said amendments to the Banking Companies Act aim to put oversight of all banks on a level-playing field.

The amendments will also strengthen internal governance and risk controls, in support of a stable, well-regulated banking system.

The IMF mission chief said enhanced oversight of the state-owned commercial banks will also be pursued to improve their financial performance and increase their operational independence.

On pursuing sound fiscal and debt management, the government has agreed to contain its budget deficit to 4.5 percent of gross domestic product in fiscal 2013, including the settlement of fertiliser subsidy overrun from fiscal 2012.

The IMF official said, further efforts will be made to contain subsidy costs, anchored by a fuel price adjustment formula.

To mitigate the impact of adjustments on the most vulnerable, agreed fiscal target will protect social spending by the government, Cowen added.

About the growth prospects, he said, “We expect the real GDP to grow by about 6 percent in FY13, reflecting external uncertainties and the broader global slowdown."

News: The Daily Star/Bangladesh/7th-Dec-12

A conference of the Executives of Head Office & Managers of Dhaka-based branches of NCC Bank was held recently at its Head Office. Mohammed Nurul Amin, Managing Director of the Bank attended the conference as chief guest.

Among others, Additional Managing Director Golam Hafiz Ahmed, Consultant A K Md Siddique, Deputy Managing Directors Mohabbat Khan, T M Faruque Chowdhury & Akhtar Hamid Khan, senior executives & managers of different branches attended the function.

News: The Daily Financial Express/Bangladesh/6th-Dec-12