Bangladesh to hold talks with IMF after applying for bailout
Bangladesh is to hold talks with the International Monetary Fund after applying for a bailout to prevent the country running out of cash.
The government in Dhaka – the third in south Asia to seek a financial rescue package from the IMF after Pakistan and Sri Lanka – is understood to want $4.5bn (£3.7bn) after it was hit hard by high import prices, especially for gas, and a fall in exports as the global economy slowed down.
The IMF said Bangladesh was also interested in its new resilience and sustainability facility, which is aimed at helping countries face climate change challenges.
“The IMF stands ready to support Bangladesh, and the staff will engage with the authorities on programme design as per the established policies and procedures of the Fund,” an IMF spokesperson said. “The amount of support will be part of the program design discussions.”
Bangladesh‘s $416bn economy has been one of the fastest-growing in the world for years and is based mainly on a garment industry that supplies retailers in Europe, the US and South America.
However, rising energy and food prices caused by Russia’s invasion of Ukraine have inflated Bangladesh’s import bill, sending its balance of payments into deficit.
About 90 countries have sought support from the IMF during the pandemic, but only a handful have been forced to seek bailouts to avoid defaulting on loans or being unable to pay bills.
Overall, the Washington-based lender of last resort is making about $250bn, a quarter of its $1tn lending capacity, available to member countries.
Bangladesh’s finance minister, AHM Mustafa Kamal, said the government would take an IMF loan only if conditions were favourable, after he denied the underlying financial situation facing the country of 170
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