The governor emphasizes that Bangladesh needs to enhance revenue collection.
The Governor of Bangladesh Bank, Ahsan H Mansur, expressed concerns about the country’s diminishing reliance on foreign aid in relation to its GDP and the pressing need for improved resource mobilization. He remarked that Bangladesh should focus on generating its own funds.
Speaking at an event organized by Care Bangladesh in Dhaka, Mansur highlighted that since 1970, there has been a notable decrease in foreign aid, which previously constituted about 12-14% of GDP.
“Bangladesh isn’t performing well in terms of revenue collection, and it’s crucial that we focus on this more constructively,” he stated. He mentioned ongoing government efforts aimed at addressing this issue.
Mansur pointed out that national revenue and memorandum staff strikes have impacted the situation, as those involved seemed resistant to change. He emphasized the necessity of breaking free from the current state and embarking on a more effective revenue generation path.
He elaborated that foreign funding could also come from private sector investments, indicating Bangladesh’s potential to access private capital markets.
The governor outlined that the government is actively working on multiple fronts to strengthen the financial sector, underscoring two key priorities: maintaining price stability and ensuring financial sector stability, which he deemed at risk.
“We’re all aware of the issues within our banking sector. Stabilization is a priority, and while detailed plans exist that could span 3-4 years, there’s a belief that these targets can be met,” he explained.
He also stressed the importance of innovation and financial education, mentioning ongoing efforts in these areas.
The governor noted that there is increasing transparency in borrowing practices and highlighted initiatives to engage unbanked communities through various channels.
The banking sector is expanding into rural areas using agent banking, and Mansur mentioned the rise of mobile financial services. Daily, approximately 4,000 loans are being issued through the BKASH mobile app, allowing for transactions without physical contact, totaling around TK7,000 crores granted thus far.
