Photo : Collected
The International Monetary Fund (IMF) has recommended strengthening the regulatory framework in Bangladesh's financial sector and accelerating reforms to ensure good governance. Additionally, the IMF has urged for increased transparency in the preparation of credit reports in line with international best practices. The agency also suggested further appreciation of the dollar.
Furthermore, the IMF has recommended an annual inventory of government officials' assets to reduce corruption. These recommendations were included in the IMF report published on Monday. As Bangladesh is taking loans from the IMF, it is required to undertake various reform activities in accordance with the organisation’s conditions.
However, it is important to consider other factors, including the impact on investment and inflation, before proceeding with further appreciation of the dollar.
Meanwhile, there has been widespread discussion about the corruption of some current and former influential government officials in the country. In this context, the recommendation to take an annual inventory of the assets of government officials is logical. This process will help to reduce corruption in the country.
The IMF report also stated that financial sector debt reports should be prepared in coordination with international standards and that the definition of defaulted loans should align with these standards. It should be noted that the current definition of defaulted loans in the country is not up to international standards. Instead, the definition includes many concessions. As a result, individuals who would be considered defaulters according to international standards are often not classified as such for at least 3 to 6 months.
Additionally, there are gaps in the reports prepared after loan disbursements. These reports do not clearly indicate whether a loan is in good condition or heading towards default. In reality, debtors should no longer be given concessions. The prevalence of defaulted loans has led to a multifaceted crisis in the financial sector. Despite various facilities and concessions provided to borrowers in recent years, no significant benefits have been observed. Moreover, the amount of debt owed by willful borrowers has increased.
Therefore, timely measures should be taken to recover defaulted loans. Simultaneously, appropriate actions should be implemented to prevent money laundering. It is crucial to investigate why the steps taken to mitigate the severity of the financial sector's crisis have not yielded the desired benefits.
Timely steps should also be taken to establish good governance in various sectors, including the financial sector and banking system.
Messenger/Fameema
