Govt to seek $4.5 billion as budget deficit from donors


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Govt to seek $4.5 billion as budget deficit from donors

Bangladesh will seek multilateral donor agencies and donor countries US $4.57billion as budget support for next three years.

The amount is seeking from the traditional donors specially this time aiming to cover the deficit in the next two fiscals budgets and current year review budget on the Covid-19 aftermath.

The foreign assistance plan for next three consecutive fiscal years was placed before Prime Minister Sheikh Hasina by Finance Minister AHM Mustafa Kamal last week.

Multilateral leaders are World Bank, ADB, AIIB and IsDB while the state development partners Japanese agency JICA, European Union, France AFD (Agence française de développement) and Germany Agency for International Cooperation (GIZ).

The speculated aid is projected to be utilized in health sector and jobs creation in the country as well as implementation of incentive packages announced for Covid-19.

“We received very positive response from the donor agencies about the speculative assistance on the back drop of the pandemic,”  Finance Minister AHM Mustafa Kamal told reporters after a meeting with several top executives of the development partners and foreign ambassadors On May 18, 2020.

He said the country need a lot of money to offset the economic losses. “Revenue collection, export earning, remittance earning and other revenue generating sectors received a blow from the coronavirus pandemic,” he pointed out.

An official of finance division, who is involved in the budgeting process, said, “We have expected more than Tk 80,000 crore from development partners in the foreign assistance.”

They may give new loan to Bangladesh as most of the big economiesare engaged in cushioning the adverse impact ofcoronavirus, an official said.

Japan International Cooperation Agency (JICA) and the Jeddah-based Islamic Development Bank (IsDB) have agreed to provide budget support to Bangladesh to meet its ballooning expenditure needs, ministry sources said.

JICA has already promised to provide $500 million each for next 2020-21 and 2021-22 fiscal years.

The government has asked for $500 million from the AIIB for the current fiscal year and another Tk 1000 million for the next two fiscal years. A day ago Chinese leaders declared $250 million in credit to soften coronavirus blow.

It also sought $1.5 billion from the ADB in budget assistance. However, ADB disbursed $100 million for immediate use of fund to absorb the Covid-19 shock.

Officials of the Economics Relation Division said the budget aid would not, however, affect the ongoing financing to JICA-supported projects in Bangladesh.

As per finance division presentation, the government has sought $280 million from development agencies of the European Union, France and Germany.



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