IMF’s Loan and its Implications on Bangladesh Economy

Bangladesh is negotiating a credit deal with the International Monetary Fund (IMF) equivalent to USD one billion under its Extended Credit Facilities (ECF) program for three years. The ECF would replace the Poverty Reduction and Growth Facility (PRGF) under which medium term financial support is provided to countries with persistent balance of payments problems.The credit facility endorsed by the IMF is quite similar to that of the World Bank accompanied by a set of conditions which might go against the interest of the debtor countries. The archetypal prerequisites for IMF credit facility are privatization, trade liberalization, and increase of interest rate as well as reduction of subsidy in oil prices.This issue of the Bangladesh Economic Update investigates the conditions of IMF’s one billion dollars loan and its implications in the economy of Bangladesh.