Highlights:
- IMF to delay the 6th instalment of the $4.7 billion loan until an elected government is in place.
- Decision confirmed by Finance Adviser Salehuddin Ahmed and BB Governor Ahsan H Mansur.
- Instalment postponed from December–January to March–April.
- Bangladesh has received $3 billion of the $5.5 billion total.
- IMF mission to arrive on 29 October for the loan review.
The International Monetary Fund (IMF) will not release the next instalment of its $4.7 billion loan to Bangladesh until an elected government is in place, a stance aimed at ensuring the new administration will honour the terms of the loan agreement.
According to Finance Adviser Salehuddin Ahmed and Bangladesh Bank Governor Ahsan H Mansur, who attended the IMF and World Bank annual meetings in Washington, the lender wants to be certain that the political government formed after the February national election will comply with the loan terms.
The adviser and the governor told journalists that the IMF had conveyed this message to the Bangladeshi delegation.
The sixth instalment of the loan, earlier scheduled for release in late December or early January, has now been delayed.
The IMF is expected to disburse the funds only after confirming the new government’s stance on the programme’s policy conditions.
Amid the dollar shortage, the previous Awami League government signed a $4.7 billion loan agreement with the IMF, followed by an additional $800 million deal under the interim administration.
Bangladesh has so far received about $3 billion from the total $5.5 billion commitment. The sixth instalment was due in December, with the seventh scheduled for June next year.
Before releasing each instalment, an IMF mission typically visits Bangladesh for a two-week review to assess progress in meeting reform conditions.
The mission is set to arrive on 29 October to begin the assessment for the sixth instalment.
Officials at the Ministry of Finance said that Bangladesh has fulfilled nearly all of the IMF’s conditions for the next disbursement, except for the revenue collection target.
In Washington, the Bangladesh Bank governor said, “Even if we fulfil all the conditions, we may not receive the instalment on time. The IMF will release the sixth instalment only after confirming that the political government after the February election will continue to abide by the loan conditions.”
Finance Adviser Salehuddin Ahmed told reporters that the next instalment is now expected between March and April instead of December.
