Finance minister confident Bangladesh forex reserves will reach $50bn by 2021-end

Finance Minister AHM Mustafa Kamal is confident that Bangladesh’s foreign currency reserves will cross $50 billion by the end of 2021.

He reaffirmed the government’s eagerness to use the reserves for infrastructure development projects while briefing the media after a virtual meeting of the Cabinet Committee on Government Purchase on Wednesday.

Buoyed by growing remittance inflow, Bangladesh Bank’s foreign exchange reserves topped $41 billion on Oct 29, three weeks after crossing the $40 billion for the first time. The amount is sufficient to pay more than 10 months of import bills.

An increase in export earnings and a drop in imports also played a role in the rise of the reserves, but exports slipped back into the negative territory in October with a second wave of coronavirus infections surging in Europe and the US.

“The reserves will be $50 billion within the next 14 months, by December next year,” Kamal said.

He thinks it will be better for Bangladesh to use the reserves for “good projects”. It will keep the money in the country and help the government borrow less from foreign sources, he said.

But the final decision and plan still depend on Prime Minister Sheikh Hasina, the finance minister said when a journalist asked whether private firms will be given loans from the reserves.

“We will use the reserves so that we can benefit commercially,” he said.