ADB awaits IMF ‘Comfort Letter’ before budget support
News Desk :
The Asian Development Bank (ADB) has indicated its willingness to consider extending budget support to Bangladesh if a ‘letter of comfort’ is provided by the International Monetary Fund (IMF), Finance Adviser Dr Salehuddin Ahmed said on Sunday.
Speaking to The Financial Express on the sidelines of the 58th
ADB Annual Meeting in Milan, Italy, Dr Salehuddin said that while a formal agreement with the IMF may not be imperative, a positive signal from the Fund on Bangladesh’s macroeconomic stability would be pivotal for securing ADB support.
“As the IMF conducts due diligence on macroeconomic matters, its assurance is important for ADB’s budget support,” the adviser said.
He noted that the scope for a “soft landing” in the current economic climate is narrowing, with many of Bangladesh’s financial buffers already exhausted.
Bangladesh has proposed accessing funds through the ADB’s Ordinary Capital Resources (OCR) window, but the lender highlighted that the window’s availability is constrained due to high demand from other countries.
Nevertheless, ADB officials assured that the proposal would be considered. “We informed ADB that our negotiations with the IMF are ongoing and close to conclusion,” Dr Salehuddin added.
ADB has encouraged Bangladesh to resolve its outstanding issues with the IMF to pave the way for continued financial assistance. However, the finance adviser reiterated that Dhaka would not rush into an agreement that blindly accepts IMF conditions.
He further stated that the country’s economic indicators have improved over the past four months, with positive developments in banking fundamentals and the private sector.
“The ADB is also interested in supporting our infrastructure development and reform initiatives, particularly in the banking sector and project implementation,” he said.
Dr Salehuddin expressed optimism regarding the upcoming national budget, saying, “We will be able to present a realistic and manageable budget.” He also affirmed that the country’s economy remains resilient, even in the event of delayed or limited budget support from international lenders.