B Mirro Report:  The International Monetary Fund (IMF) has begun discussions with Bangladesh on its reform agenda and policy priorities after the government sought a new IMF-supported financial arrangement to strengthen economic stability and advance long-term reforms.

In a statement issued from Washington, DC, IMF Mission Chief for Bangladesh Ivo Krznar said Fund staff are working closely with the Bangladeshi authorities as the IMF considers the possibility of a successor programme.

According to Krznar, the government has requested a new financial arrangement to support its economic reform efforts, and discussions are currently focused on identifying key policy priorities and reform measures.

He noted that Bangladesh’s ongoing programmes under the Extended Credit Facility (ECF), Extended Fund Facility (EFF), and Resilience and Sustainability Facility (RSF) have played a crucial role in guiding economic policies during a challenging period.

At the same time, Krznar said the country’s economic and political environment has changed considerably since the current IMF-supported package was approved in January 2023. He pointed to weaknesses in the banking sector and low revenue collection as major challenges that require sustained reform efforts.

The IMF official said the request for a new programme offers an opportunity to design a framework that addresses current economic realities while reflecting the priorities of the country’s present leadership.

He emphasized that any future arrangement would depend on Bangladesh’s balance-of-payments needs and the government’s commitment to implementing a credible reform agenda. Such a programme would also be subject to IMF policies and approval by its Executive Board.

Krznar said preparations are underway for an IMF staff visit to Bangladesh, during which officials will review recent economic developments, discuss policy objectives with the authorities, and assess the country’s economic outlook and reform needs.
He added that detailed negotiations on the size, structure, and reform conditions of any potential new programme would take place during a subsequent mission dedicated to programme discussions.

Reaffirming the IMF’s support for Bangladesh, Krznar said the Fund remains committed to helping the country achieve macroeconomic and financial stability, strengthen resilience, and promote sustainable and inclusive economic growth through continued cooperation with the government and other stakeholders.