The countrys balance of payments for July-April, 2023-2024 (FY24) showed significant improvement compared to the same period in the previous fiscal year, July-April, 2022-2023(FY23).
According to Bangladesh Banks latest statement released on Wednesday despite challenges, there are some positive trends in the financial account, current account, and the overall balance of payments.
The financial account registered a notable improvement, increasing from $653 million in the previous period to $2,233 million in the current period.
This rise can be attributed to higher foreign direct investment (FDI) inflows, which amounted to $3,594 million, reflecting a slight decrease of 3.6 per cent from the previous year. Meanwhile, net FDI liabilities rose marginally by 0.7 per cent to $1,364 million.
In the current account, the deficit decreased significantly from $10,188 million to $5,729 million. This improvement was driven by a decrease in the trade balance deficit, which narrowed from $23,601 million to $18,698 million.
Export earnings, including those from the Export Processing Zones (EPZ), fell by 6.8 per cent to $33,675 million, while imports dropped by 12.3 per cent to $52,373 million. Notably, private transfers, particularly workers remittances, saw a 7.6 per cent increase, reaching $19,581 million.
The overall balance of payments deficit also improved, reducing from $8,804 million to $5,565 million. Reserve assets followed a similar trend, increasing to $5,565 million from $4,754 million.
Gross official reserves stood at $25,365 million, up from $25,232 million, providing a buffer for future economic uncertainties.
The balance of payments for July-April, 2023-2024 (FY24) highlights positive trends in the financial and current accounts, as well as an overall reduction in the balance of payments deficit compared to the same period last fiscal year.
These improvements underscore the countrys resilience and ability to attract foreign investment despite global economic challenges.
When contacted Professor Mustafizur Rahman, fellow, Centre for Policy Dialogue said this improvement in the financial account and the reduction in the current account deficit demonstrate Bangladeshs growing economic resilience and capacity to attract foreign investment.
The increase in workers remittances and the narrowing trade balance highlight the robust performance of key sectors, contributing to a more stable overall balance of payments, he said.
