Bangladesh asks IFC to provide easy loans to private sector

Finance Minister AHM Mustafa Kamal has requested the International Finance Corporation to provide easy loans for the development of the country’s private sector.

Kamal made his request to the IFC on the sideline of the annual World Bank-IMF meeting held virtually on October 16.

Finance Minister AHM Mustafa Kamal and IFC Managing Director Makhter Diop represented their respective delegations.

With the WB-IMF meeting, the Bangladesh delegation was represented by the Alternate Executive Director of the World Bank Mohammad Shafiul Alam, Senior Secretary of the Finance Division, Abdur Rouf Talukder, and Secretary of the Economic Relations Division, Fatima Yasmin.

In his speech, the Finance Minister praised the IFC for issuing “Bangla Bond” at the London Stock Exchange in 2019. He thanked the IFC for its continued investment support to Bangladesh’s private sector, especially banks, various manufacturing companies and new entrepreneurs during the Covid-19 pandemic. At the time, the Finance Minister highlighted the steps taken by the Government of Bangladesh to tackle the infection of Coronavirus and the maintaining positive GDP growth last year.

The meeting discussed the issue of “Taka Bonds” in the capital market of Bangladesh, overall financial sector reform, IFC’s Country Strategy and investment through Public Private Partnership (PPP). The Finance Minister requested the IFC to provide loans on easy terms in other sectors including Onshore Taka Bonds, PPPs for the development of the private sector.

He highlighted the need for huge investment in building a middle-income country by 2031 and a developed country by 2041 and requested the IFC to provide the necessary technical assistance.

Mustafa also urged the IFC to come forward to increase private sector investment in Bangladesh.

Meanwhile, the IFC hopes to further consolidate their future partnership with Bangladesh.

Two month ago IFC had said amid a difficult year with massive and ongoing social and economic disruptions caused by Covid-19, they committed over $3.8 billion, including mobilization and short-term finance, in South Asia as of June 2021.

In India, IFC’s largest client country globally, total commitments at the end of June stood at $1.7 billion representing an increase of over 51 per cent from last year. Likewise, in Bangladesh, IFC made total commitments of $791 million, an increase of almost 33 per cent from last year.

IFC has committed $590 million in Covid-response deals in South Asia—with additional deals worth over $100 million in the pipeline.