Dhaka, Bangladesh (BBN)- Bangladesh’s overall balance of payments (BoP) continued to maintain a surplus position despite a deficit in the financial account during the first nine months of the current fiscal.
The current account balance also recorded a surplus during the July-March period of fiscal 2008-09, thanks to robust growth of inward remittance, officials said on Saturday.
“We expect that the existing trend of current account balance along with the overall balance of payments will continue over the remaining period of this fiscal year,” Director General of the Bangladesh Institute of Development Studies (BIDS) Mustafa K Mujeri told BBN in the capital, Dhaka.
Mr. Mujeri, also former chief economist of the central bank, said the pressure of import payments has eased slightly during the period because of the falling trend in prices of essential commodities in the global market, which helps reduce the country’s overall trade deficit.
Bangladesh’s overall trade deficit rose to $4.040 billion during the period from $3.759 billion of the corresponding period of the previous fiscal.
During the period, export earnings stood at $11.678 billion against the import payments of $15.718 billion, according to the central bank statistics.
“Due to larger current account transfers of $7.405 billion the current account balance recorded a surplus of $1.090 billion during July-March, 2008-09 against the surplus of $415 million during July-March, 2007-08,” the central bank said in its Major Economic Indicators: Monthly Update-May, 2009.
The overall balance also showed a larger surplus of $1.037 billion during the period under review against the deficit of $172 million during July-March period of the previous fiscal, according to the Monthly Update.
However, the deficit of overall financial account balance rose to $303 million during the period from $272 million a year ago.
“Declining balance of the financial account indicated an indirect impact of the global meltdown that has forced the overseas aid flow to drop during the period,” a BB senior official said.
The net receipts of foreign aid stood lower at $888.26 million during the period against $964.85 million of the corresponding period of previous fiscal, according to the BB official.
“We’ve overcome the financial account deficit with the strong position of current account balance that stood at $1.090 billion during the period against only $415 million a year back,” the BB official added.
Meanwhile, remittances from Bangladeshi expatriates stood at $8.764 billion in 11 months of this fiscal, growing by 22.39 per cent from that of the corresponding period of last fiscal.
The country received $8.764 billion during the July-May period of fiscal 2008-09 against $7.161 billion of the corresponding period of the previous fiscal, the BB’s data showed.
However, the flow of net foreign direct investment (FDI) rose to $882 million during the period from $527 million of the corresponding period of the previous fiscal, the Update said.
On the other hand, the flow of portfolio investment has recorded a deficit of $111 million during the period under review due to the ongoing global financial meltdown, the central bank officials added.
BBN/SS/SI/AD-14June09-12:39 am (BST)
