Good morning. Here's what happened overnight and what you need to know today.
1.
Buoyancy in Exports Continues: Bangladesh's exports rose for a fourth straight month in November as goods that had been stuck for the past three months were finally shipped. A general increase in the flow of orders due to an improvement in the global economy and the Christmas shopping season, which is now in full swing, also played a role. Data released by the Export Promotion Bureau (EPB) yesterday showed that exports surged nearly 16 percent year-on-year in November to $4.11 billion, welcome news for an economy that has faced various challenges, including a US dollar crunch, in recent times. (The Daily Star)
2.
Russia to Get Rooppur Loan Payments via Sonali Bank Account: Bangladesh and Russia have reached an agreement on a mechanism to repay the principal and interest of the Rooppur Nuclear Power Plant loan, bringing clarity to the long-pending issue after extended negotiations, according to officials from the Economic Relations Division (ERD). Under the agreement, a foreign currency account will be opened in the name of the Russian government at Bangladesh's state-owned Sonali Bank's Local Branch in Dhaka. The Russian Ministry of Finance will manage the account and receive payments going forward with the account set to open following final approval from the Russian central government. (The Business Standard)
3.
Power-sector Reform Can Save $1.2b Annually: Power-sector reforms can save Bangladesh US$1.2 billion, equivalent to Tk 138 billion, annually through reduction in state subsidy to the power board, according to a research finding. This could be realised by shifting half of the industrial demand met by captive generators to the national power grid, adding 3,000 megawatts (MW) of renewables, reducing load-shedding to 5.0 per cent from the FY24 level, and limiting transmission and distribution losses to 8.0 per cent, says the Institute for Energy Economics and Financial Analysis (IEEFA) in a report titled 'Fixing Bangladesh's Power Sector'. (The Financial Express)
4.
RMG Exports Log 12.34pc Growth in First Five Months of FY ’25: Export earnings from the country's readymade garment (RMG) sector recorded a growth of 12.34 per cent year on year to fetch US$16.11 billion during the first five months of the current fiscal year, pushing the overall growth to 11.76 percent. RMG that contributed more than 80 per cent of Bangladesh's overall export earnings brought US$3.30 billion in November 2024 which was 16.25 per cent higher than the November 2023 earnings of US$2.84 billion, according to Export Promotion Bureau (EPB) data released on Wednesday. The sector witnessed 2.89 per cent growth in last July, followed by 7.20 per cent in August, 14.61 per cent in September and 22.80 per cent in October respectively. (The Financial Express)
5.
Bangladesh Already in Middle-Income Trap: The white paper on Bangladesh's economy says the country has already fallen into the middle-income trap as employment and productivity data conflict with the past years' higher-growth narratives. Bangladesh started falling into the trap in the fiscal year 2013-14 and is now already trapped, according to Dr Zahid Hussain, a member of the white paper committee. Referring to World Bank (WB) surveys, the white paper said other countries fell into the trap upon reaching the per capita income threshold of $8,000, but Bangladesh is still below that. (The Financial Express)
6.
IMF Asks to Raise Tax-GDP Ratio by 0.6 Percentage Points: The International Monetary Fund (IMF) has asked to increase the tax to GDP ratio by 0.6 percentage points by the end of this fiscal year to make up for last fiscal year's revenue collection shortfall. Last fiscal year, the ratio stood at 7.3 percent. As per conditions of an existing loan of the Washington-based lender, the ratio was supposed to be increased by 0.5 percentage points every year. (The Daily Star)
----Saju Sarker
BBN/SSR/AD