Good morning. Here's what happened overnight and what you need to know today.
1.
FDI Data Overstated by $5.7b in Four Years: The Bangladesh Bank overstated the net foreign direct investment data by $5.7 billion between fiscal 2019-20 and 2022-23. The data anomaly came to the fore after the BB revised the data from fiscal 2019-20 as per the BPM6 guideline of the International Monetary Fund, said BB spokeswoman Husne Ara Shikha. "We corrected the data as there was an observation from the IMF on the previous data. The FDI inflow came down drastically due to the data correction," she said. Previously, the data for exports and foreign exchange reserves were overreported and had to be corrected following IMF observations. (The Daily Star)
2.
Current Account Deficit Narrows in Jul-Oct: Bangladesh's current account deficit narrowed 76.20 percent year-on-year to $752 million in the first four months of the current fiscal year on the back of growing export earnings and remittance inflows, reflecting reduced pressure on the country's external accounts. Bangladesh Bank data showed that the current account deficit was $3.16 billion in the four months to the end of October a year ago. Remittances sent home by Bangladeshis living abroad rose 14 percent year-on-year to $2.2 billion in November, according to central bank data. (The Daily Star)
3.
How Minimum Tax is Eroding Companies’ Capital: Companies in Bangladesh are grappling with rigid minimum taxes and source tax deductions regardless of profitability amid rising production costs and an economic slowdown in recent months. Entrepreneurs say the political instability in the country since mid-July has further impacted their businesses, making the collection of minimum tax at the existing rates feel like "adding insult to injury". Under the Income Tax Act, companies have no provision to adjust or claim refunds for minimum tax deducted on turnover or, in many cases, tax deduction at source (TDS). This means that if a company's profit is lower than the advance tax deducted, its effective tax rate increases. Even in case of losses, the tax cannot be adjusted directly reducing the company's capital. (The Business Standard)
4.
Budget Surplus Heralds Interim Govt's Initial Reign: A modest budget surplus heralds interim government's initial reign as tightfisted spending to weather inherited crunch yielded Tk 48.38 billion fiscal savings in the July-September period by official count. However, the surplus in the first quarter of the current financial year 2024-25 was one-third lower than the amount of the same period last year. This surplus is primarily attributed to poor spending on public-works projects under the Annual Development Programme (ADP), as the post-uprising government reset priorities and laid off less-priority undertakings. (The Financial Express)
5.
Export Earnings Grow 16.23pc in Nov: Country's merchandise- export earnings increased 16.23 per cent to US$4.14 billion in November 2024, according to provisional data of Export Promotion Bureau (EPB).The earnings were US$ 3.56 billion in November last year. EPB data also revealed that the overall export trade during the first five months (July to November) of the current fiscal year (FY 2024-25) grew 11.88 per cent to US$19.92 billion from $17.81 billion in the same period last FY. However, the new format of data didn't show the period's target. (The Financial Express)
6.
Tk 1.46t Bribes Paid in Service Sectors in 15 Years: TIB: Service-seekers in Bangladesh paid an estimated Tk 1.46 trillion in bribes between 2009 and April 2024 to access essential services, according to a new survey by the Transparency International Bangladesh (TIB). This period corresponds to the tenure of the previous Awami League government. Some 70.9 per cent of households experienced corruption while accessing services from various public and private sectors or institutions in 2023, the survey titled "Corruption in Service Sectors: National Household Survey 2023" revealed. (The Financial Express)
----Saju Sarker
BBN/SSR/AD