|
| Bangla |
Economic Features |
English |
|
|
|
|
 |
Foreign Aid and Loans |
 |
-: Continuation :-
|
|
It is the IMF that has been imposing structural adjustment programmes on different countries; and in the macro economic level Bangladesh has got the IMF as its main consultant the directives of which played a major role in fixing the national salary structure (article 4 mission). This raised the exchange rates of the dollar against taka, led to increases in the price of gas, fuel, and electricity.
According to the donors, the conditionalities that come along the aid programmes are meant to ensure the effective use of the aid money for the stated purposes. And these stipulations have now grown more important than they were in any previous time, with IMF imposing two types of policy conditions, namely quantitative and structural. Quantitative conditions are imposed at the macroeconomic level of the poor countries, while the structural ones are for institutional and legislative policy reforms. All of these prove to be unfair, undemocratic, ineffective, and inappropriate mainly because they undermine democratic accountability within countries and deprive the poor of the access to the services (education, health, etc) at a low cost. And what is alarming, the WB instruction to stop appointing to different vacant posts resulted in raising the unemployment rate to 40% in Bangladesh in the year 2005.
|
| |
|
|
| |
|
Bangladesh Government has already started bank sector reform. The project name is “Industry Development and Bank Modernization”. Another project also in hand is named “Central Bank Strengthening Project”. The loan amount is estimated as 38 crore 83 lacks 90 thousand USD and 4 crore 61 lacks 30 thousand respectively, for the above projects. Donors have imposed a tag of bank privatization with these loans. A lion’s share of this project money is ready to be spent as consultancy fee. According to ERD, more than 15 to 20 percent money had always been spent for consultants.
|
| |
Some of the conditions commonly implemented are:
|
- Cutting social expenditures, also known as austerity;
- Implementing user fees in basic services such as education and health;
- Focusing economic output on direct export and resource extraction;
- Devaluation of overvalued currencies;
- Trade liberalization, or lifting import and export restrictions;
- Increasing the stability of investment (by supplementing foreign direct investment with the opening of domestic stock markets);
- Balancing budgets and not overspending;
- Removing price controls and state subsidies;
- Privatization, or divestiture of all or part of state-owned enterprises; and
- Enhancing the rights of foreign investors vis-a-vis national laws.
|
Conclusion :
Aid programmes are in need of restructuring in order to be more effective. A good account keeping, effective administration and determining the exact volume of loan and aid, and coordination among the donors are the measures to be adapted to this end. Most importantly, donors need to realize that they have moral obligations to help poor nations, but have no right to attach conditions to the aid that they provide.
Therefore, for aid to be effective, no conditions are acceptable at all - be it in aid, loans or grants. As committed, discussion in parliament on overseas assistance is necessary for public participation. Non-interventions of the IMF and WB in the allocation of financial and technical assistance, cancellation of PRSP, domestic resource mobilization and preparation of a central plan to make the donor agencies and government accountable to be accountable to the people are the prerequisites to ensure aid effectiveness
|
| |
|
|
|
|
|
|
|
|
| |
| Digital bangladesh Features |
| Ads Search
Job Search
Information Zone :
|
|
| |
|
| |
|
|
|
