Bangladesh forex reserves cross $36bn after record remittances

  • Abdur Rahim Harmachi, Chief Economics Correspondent,
    Published: 2020-07-02 19:30:21 BdST

US Dollar banknotes are seen in this photo illustration taken February 12, 2018. Reuters

Bangladesh Bank’s foreign exchange reserves rose to an all-time high of $36.14 billion on Thursday after expatriate Bangladeshis sent home a record $1.833 billion in June despite the coronavirus pandemic ravaging economies.The previous highest monthly remittance was $1.748 billion in June last year ahead of Eid-ul-Fitr.

In the 2019-20 financial year that ended on Jun 30, the country received a total of $18.2 billion in remittances, which is 10.85 percent more than $16.42 billion received in the previous fiscal year.

On Jun 3, the foreign reserves crossed $34 billion for the first time after Bangladesh received a $732 million fund from the International Monetary Fund. It finally crossed the milestone of $35 billion in three weeks.

Besides remittances, funds from the World Bank, IMF, Asian Development Bank, and Asian Infrastructure Investment Bank also played a role in pushing the foreign currency reserves over $36 billion eight days after crossing $35 billion, said central bank spokesman Kazi Saidur Rahman.

While exports and imports have dropped sharply due to the coronavirus crisis, inward remittances remained largely unscathed thanks to 2 percent incentives.

That is why the government continued to provide the incentive in fiscal 2020-21 in order to encourage the expatriates to avoid illegal channels to send money.

“Many expatriates are sending their savings because they want to return home,” Saidur said.