Annual external debts can be paid with two-month installment: finance minister

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TBS Report

May 19, 2022, 9:55 PM

Last modification: May 21, 2022, 00:28

Finance Minister AHM Mustafa Kamal, Photo: TBS

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Finance Minister AHM Mustafa Kamal, Photo: TBS

Finance Minister AHM Mustafa Kamal said it was possible to repay the country’s external debt all year round with remittances sent by expatriates in just two months.

“Bangladesh would spend $2.4 billion on external debt repayment in the current fiscal year, which would rise to $2.8 billion in the next fiscal year. In the fiscal year 2023-24, $3.3 billion will be spent on paying off external debts and $4 billion the following year,” the minister said as he compared Bangladesh to Sri Lanka in a pre-budget chat held online with editors. chief of newspapers and senior electronic media executives on Thursday evening.

“Our expatriates are sending $2 billion home this month. With the remittances over two months, it will be possible to meet Bangladesh’s external debt for the whole year,” he said.

“We are used to dealing with crises, we have experience,” Kamal said, referring to the country’s rising inflation and the foreign currency crisis due to the ongoing war between Russia and Russia. Ukraine.

“I was asked if the situation in Bangladesh would be like Sri Lanka, but we financed Sri Lanka. Their inflation rate has been at 31% for a long time. India and Pakistan have high inflation too, but it has never exceeded 6% in Bangladesh. Our debt-to-GDP ratio is also at an all-time low, 34-35% of GDP,” the minister said.

“We accept loans for productive projects. We approve the project taking into account the income generated by the projects, the number of jobs created and whether or not the costs are reduced,” he said.

“About 77% of our loan is a soft loan, contracted with the World Bank, the Asian Development Bank (AfDB), the Islamic Development Bank and the Japan International Cooperation Agency (JICA). On the other hand, Sri Lanka has taken loans from commercial banks,” the minister said.

On inflation, Kamal said, “The Food and Agriculture Organization of the United Nations (FAO) said in May that commodity prices had risen by 30% on the world market. According to the World Bank, prices for wheat, beef, chicken, soybeans, petroleum, sugar, urea, TSP and fuel oil have risen sharply.”

“We are a market economy. If something happens anywhere in the world, it affects us too. We have to run our country in agreement with the rest of the world,” he said.

“We design our budget for the people. We want to move forward with everyone. We have prioritized agriculture and job creation. Now we are prioritizing ‘Made in Bangladesh’. The next budget will be accountable and transparent,” says Kamal.

Mustafa Kamal said the slight increase in fuel prices will be borne by consumers and the government. “It will not be imposed on the government or the consumer alone,” he said.

“We have many alternatives to deal with the economic crisis in the current global situation, and we will use these weapons when needed,” the minister said.

Expressing his hope, the finance minister said: “It is easy to deal with one problem at a time, rather than dealing with them all at once. We will not fail.

“Even in times of crisis in the world, we have not adopted any policies of contraction. We are implementing policies of expansion. Many have suggested to further increase the budget deficit, but we have increased as much as necessary. However , our budget deficit is much lower than the rest of the world.”

At the meeting, top media executives emphasized inflation control and foreign exchange management.

In addition, newspaper publishers made various recommendations, including reducing the corporate tax rate in the newspaper industry from 30% to 10-12% and reducing import duties on newsprint in the next budget.

The publishers have also requested an additional allocation in the next budget to pay overdue advertising bills from various government institutions.

In response, the Minister of Finance assured to take care of the advertising bills due.

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