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COVID-19 Outbreak

Kamal seeks greater support from WB, IMF

  • Staff Correspondent
  • 26 March, 2020 12:00 AM
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Kamal seeks greater support from WB, IMF

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Finance Minister AHM Mustafa Kamal has sought greater support from the World Bank and IMF to recoup economic losses likely to stem from the Coronavirus pandemic.

The finance minister made the call in a video conference with the global financial agencies’ headquarters from his office in the capital on Wednesday.  

The country may have to face adverse economic impacts translated to slowing growth, export and remittance losses and delay in ongoing large projects because of the pandemic, he feared. 

“The whole world is now passing a tough time. We have to find out some ways so that we can bring some hope for the people around the world,” a ministry release quoted Kamal as saying at the very outset of the conference.

“Bangladesh and the world economy have to encounter negative impacts of Coronavirus at a time when we are waiting for achieving SDGs and becoming a higher middle-income country by 2030,” he repented.

“No country will be able to face this disastrous situation alone. We will request the World Bank Group and International Monetary Fund (IMF) to stand beside us at this critical moment,” he said, hoping that the agencies will ensure greater support for Bangladesh considering its risk factors.

The World Bank has created a $14 billion global fund to help fight Covid19 while the IMF has announced $50 billion funds of which it said $10 billion will go to developing countries.

Bangladesh is expecting a large support from these funds to cope up with the potential economic crisis in the coming days. 

Citing an economic loss assessment by the Asian Development Bank (ADB), the finance minister feared that Bangladesh may incur 1.1 per cent GDP loss because of the global pandemic.  

Bangladesh has achieved “enviable” economic growth in recent years with posting Asia-Pacific region highest rate of 8.15 per cent in FY19 while maintaining over 7 per cent growth in a row in previous three fiscal years, Kamal noted. 

The government had a target to achieve 8.2 per cent growth this year driven by domestic demand and favourable revenue and monetary policies, which now seems uncertain, he pointed out.  

Desperate attempts to prevent the spread of Coronavirus include unprecedented lockdown, shutdown and communications disruptions, which have already started telling upon the global economy inevitably.

This has reflections in 28-34 per cent fall in the global world capital market. If the situation continues, the world economy may witness a growth fall by 1.5 per cent. 

“Bangladesh has started feeling the pinch. We are concerned that COVID-19 can have multi-dimensional impacts on our economy,” Kamal remarked. 

The country’s largest export earning apparel sector has already incurred huge losses because of shutdown in Europe and America, he said, also fearing that the infrastructure projects may linger further. 

Foreign remittance was a major strength of Bangladesh economy but a slowdown is imminent as a large number of Bangladeshi workers returned home after the COVID-19 outbreak became a global pandemic.