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IMF promises to include flood assistance in PRGF

UNB, Dhaka
IMF (International Monetary Fund) Managing Director Rodrigo de Rato has assured of considering the impact of recent floods in its assistance package under the Poverty Reduction Growth Facility (PRGF) being provided for Bangladesh.
The IMF is channelling a fund of $490 million in seven installments under the PRGF.
"The impact of the flood will definitely be featured in the PRGF and macroeconomic framework," he told Finance Minister Saifur Rahman as they had a meeting in Washington on Wednesday, according to a message received in Dhaka yesterday.
Rato also assured the minister of giving due consideration to a proposal for increasing resources for the Trade Integration Mechanism (TIM) to help countries mitigate the balance of payments shortfalls likely to result from the phasing out of MFA.
He noted with satisfaction the economic performance of the government of Bangladesh and hoped that the reform programme would be continued as envisaged in the I-PRSP.
Saifur apprised the IMF executive of the impact of the recent devastating floods and also of the ongoing implementation status of the Interim PRSP.
He made a commitment to maintain macroeconomic stability and allocate increased resources to poverty reduction programmes.
He, however, mentioned that the government would require substantial external assistance for post-flood rehabilitation.
The finance and planning minister called for equitable distribution of external assistance keeping in view the status of poverty levels and number of poor population in low-income countries as well as their performance and economic management capacity.
He pointed out that countries like Bangladesh, with no default record in debt servicing and have shown good economic performance, were not getting a fair deal from the Bretton Woods Institutions in terms of resource flow.
He said that the IMF and the World Bank should help good borrowers with increased flow of resources rather than "reward some countries through debt forgiveness resulting from bad economic performance".
Saifur also mentioned that Bangladesh is the first country to receive assistance from the IMF through its TIM to mitigate the likely impact of MFA phase-out.
IMF Deputy Managing Director Takatoshi Kato, IMF Director David Durton, Bangladesh Ambassador to USA Syed Hasan Ahmed, Bangladesh Bank Governor Fakhruddin Ahmed, Finance Secretary Zakir Ahmed Khan and World Bank Alternate Executive Director Akbar Ali Khan were present at the meeting.