Bangladesh’s central bank governor said on Saturday the economy remained stable despite months of political unrest that has killed 120 people and slashed domestic output, and it was working towards a credit upgrade from Standard & Poor’s.
Talking to Reuters on the sidelines of an international conference on the economy, Atiur Rahman said the bank’s proactive approach to promote economic stability during three months of turmoil helped Bangladesh to keep its stable credit outlook.
“Despite more than three months long political unrest the outlook of country’s economy is stable, and this has been confirmed by Standard & Poor’s,” Atiur said.
On Wednesday, Standard & Poor’s reaffirmed Bangladesh’s BB-/B foreign and local currency sovereign credit ratings, saying the stable outlook balanced healthy growth prospects and an improving external profile against fiscal weaknesses and development needs.
Atiur said S&P could upgrade Bangladesh’s ratings if measures to expand the revenue base and boost collection efficiency materially improved fiscal performance.
“Maintaining exchange rate stability and prudent monetary policy has helped keep inflation low along with deeper coordination between fiscal policy and monetary policy,” he said.
He added that the central bank measures to promote stability included financial inclusion, modernizing the payment system and improving transparency in the financial sector.
The political turmoil has already shaved the equivalent of 0.55 percent of Bangladesh’s annual GDP, according to the Centre for Policy Dialogue, a leading think tank.
The unrest started in January when the country’s largest opposition party, Bangladesh Nationalist Party (BNP), called a country-wide general strike and blockade after refusing to take part in last year’s general election, saying it was rigged.
Prime Minister Sheikh Hasina has refused BNP demands to step down, instead tightening her grip by arresting key opposition leaders and clamping down on media critical of her government.
- By Serajul Quadir, Reuters