The prospect of receiving subsidized loans from the AfDB is fading
According to officials, Bangladesh’s performance in key sectors has not improved in the latest Asian Development Bank (AfDB) assessment, weakening its prospect of receiving concessional funds from the lender.
The country was placed at the same rank this year as two years ago in the Country Performance Assessment (CPA) prepared by the AfDB, which could affect the inflow of concessional loans, they said on Friday. at the FE.
The Manila-based development financier recently assessed Bangladesh’s performance based on 16 categories, such as monetary and exchange rate policies, fiscal policy, debt policy and business regulatory environment and transparency, accountability and corruption in the public sector.
Among the 16 categories, four saw a slight improvement in 2022 while the other 12 maintained the same rank as two years earlier in 2020.
“Bangladesh’s performance has not improved in most categories over the past two years. AfDB assists its member countries based on the CPA,” a senior Ministry of Finance (MoF) official said, quoting the CPA of the Asian bank.
He believes that since the ODA provides a performance-based allocation for its member countries, the inflow of concessional aid from Bangladesh may decline over the next two years.
“However, we will request the Manila-based lender to extend its support as the government of Bangladesh has taken many reform initiatives in its fiscal, fiscal and monetary policies,” the finance ministry official said.
According to AfDB’s assessment, monetary and exchange rate policies scored 5.0 for the current year, 2022, as in 2020.
Similarly, the country’s fiscal policy scored 4.5, debt policy and management a score of 5.5, trade a score of 4.0; the financial sector 4.0; gender equality 4.5; Equity of Public Resource Management 4.5, Strengthening of Human Resources 4.5, Policies and Institutions for Environmental Sustainability 4.0, Quality of Public Administration 4.0, Property Rights and Rule-Based Governance 4.0, and the quality of budgetary and financial management 4.0 over the two years (2020 and 2022).
However, Bangladesh’s ranking in a few categories has been raised to some extent in the latest AfDB CPA.
Revenue Mobilization Efficiency scored 4.5 in 2022 from its previous position of 4.0, Social Protection and Labor scored 4.5 in the current year from 4.0 in 2020, Transparency, Accountability and Corruption in the Public Sector scored 4.0 in 2022, up from the previous level of 3.5 in 2020, and Business Regulatory Environment scored 4.0 in 2022. 2022 from its previous position of 3.0 two years ago.
When questioned, a senior Finance Ministry official said that Bangladesh had gone through a bad period, like other countries in the world, in the past two years due to the effects of the Covid pandemic and the Russian-Ukrainian war. .
“Within these frameworks, the country’s CPA ranking may not have improved to the expected level. But we hope to gain continued support in the 2023-2024 cycle,” he hopes.
The AfDB is one of our best development partners that has reached out to us with billions of dollars in aid since 1972, he notes.
The CPA 2022 should also not be a hindrance to increased aid flow to Bangladesh in the coming years, the finance ministry official said.
In the last fiscal year 2021-22, the AfDB became Bangladesh’s largest development partner, having confirmed assistance worth $2.08 billion.