Bangladesh seeks extended oil credit from Saudi Arabia

[Black_cats]

Stock image of oil barrels.

Bangladesh seeks extended oil credit from Saudi Arabia​

AFP
Published: 02 February ,2023: 05:30 PM
GSTUpdated: 02 February ,2023: 05:48 PM GST

Cash-strapped Bangladesh asked Saudi Arabia for extended credit on oil supplies, Dhaka’s foreign ministry said, as the South Asian nation grapples with dwindling foreign exchange reserves.

Saudi Arabia supplies more than half of Bangladesh’s crude imports, but Bangladesh has been hit hard by the global surge in energy and food prices following Russia’s invasion of Ukraine.

At the same time the taka has depreciated about 25 percent against the US dollar, driving up costs for petrol distributors and power utilities that have rippled across the rest of the economy.

Nationwide blackouts of up to 13 hours a day hit the electricity grid last year and the government offered food relief for households unable to afford rice and other staples.

In a meeting Wednesday with Riyadh’s ambassador, foreign minister A.K. Abdul Momen asked Saudi Arabia to consider supplying crude and refined oil “on a deferred payment basis”, the foreign ministry said in a statement.

The economic strains come with a general election due by next January.

The opposition Bangladesh Nationalist Party has blamed the government for the crisis, accusing it of squandering cash on multibillion-dollar vanity projects.

It has organized a series of rallies demanding Prime Minister Sheikh Hasina’s resignation and an early poll under a neutral administration.

Authorities hiked retail electricity prices by five percent Tuesday, the second such increase in three weeks, while gas prices for generators were raised by an eye-watering 178 percent last month.

On Monday, the International Monetary Fund signed off on a $4.7 billion support package for Bangladesh.

The South Asian country’s foreign exchange reserves have dropped from $46 billion in January last year to $32 billion at the end of last month.

Bangladesh’s official inflation rate is around 8.7 percent but independent economists say the true figure is substantially higher.

Bangladesh seeks extended oil credit from Saudi Arabia

Cash-strapped Bangladesh asked Saudi Arabia for extended credit on oil supplies, Dhaka’s foreign ministry said, as the South Asian nation grapples with

english.alarabiya.net

 

[bluesky]

Bangladesh seeks extended oil credit from Saudi Arabia

As far as I understand by reading the posts of many BAL party cronies here, BD is awash with dollars. the govt claims so and the brats believe them at their face value.

Begging SA for a deferred payment proves that the country's reserves have been inflated by Hasina. and much of the real FE has been laundered by Hasina and her cronies which has made the country bankrupt.

তবে , সৌদি আরব কোনো দেশেরই মামা নয় যে হাত পাতলেই সব উজাড় করে দিয়ে দেবে।

 

[bluesky]

The opposition Bangladesh Nationalist Party has blamed the government for the crisis, accusing it of squandering cash on multibillion-dollar vanity projects.

My dear @UKBengali, do you agree that all your project plannings are lopsided except perhaps the Dhaka Metroline?

Your Hasina govt is now showing off her high development projects with foreign loans and foreign companies. But, is also begging this Capital and that Capital.

The BAL party is very shameless. Your Hasina Bibi is now projecting about $12,000 per capita GDP. Do you guys think some people do not understand the BAL duplicity? On the one hand, it is ruining the future of BD and on the other hand, it is talking rosy future.

The Russian present per capita GDP is about $12,000, but it built its own atomic power station when it was less than $4,000 per capita. Do you think you guys can deceive other people with your fictitious figures when the country cannot even produce a pair of nuts & bolts?

https://www.google.com/search?q=per+capita+gdp+of+russia&oq=per+capita+gdp+of+russia&aqs=chrome..69i57j0i19i30.10253j1j7&sourceid=chrome&ie=UTF-8

 

[Black_cats]

Why Bangladesh is seeking Saudi oil on credit after IMF success​

SHEHAB SUMON
03 February 2023

Bangladeshi Foreign Minister A.K. Abdul Momen meets Saudi Ambassador Essa Al-Duhailan in Dhaka on Feb. 1, 2023. (Photo/Bangladesh Ministry of Foreign Affairs)

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Why Bangladesh is seeking Saudi oil on credit after IMF success

DHAKA: After securing a stabilization package from the International Monetary Fund this week, Bangladesh has asked Saudi Arabia for extended credit on oil supplies, in a move that experts say would further help its economy get back on track. Bangladesh Foreign Minister A.K. Abdul Momen met...

arab.news

• Bangladeshi government asks Kingdom to supply oil on deferred payment basis
• Request follows IMF approval of $4.7bn stabilization package for South Asian nation

DHAKA: After securing a stabilization package from the International Monetary Fund this week, Bangladesh has asked Saudi Arabia for extended credit on oil supplies, in a move that experts say would further help its economy get back on track.

Bangladesh Foreign Minister A.K. Abdul Momen met Riyadh’s Ambassador to Dhaka, Essa Al-Duhailan, earlier this week. The foreign ministry said after the meeting that Momen had asked the Kingdom to consider supplying crude and refined oil “on a deferred payment basis” to help Bangladesh meet its energy needs.

The request came shortly after the IMF approved a $4.7 billion loan for Bangladesh.

HIGHLIGHT​

Request follows IMF approval of $4.7bn stabilization package for South Asian nation.

“Bangladesh is now passing through a period of constrained foreign exchange reserves and is having difficulty in terms of opening LCs (letters of credit) and also in terms of paying for our imports,” Prof. Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue in Dhaka, told Arab News on Friday.

“If we can get Saudi oil on a deferred payment basis, it will ease up Bangladesh’s foreign exchange reserves and help Bangladesh in terms of purchasing other necessary imports which require instantaneous payment.”

The IMF’s Extended Credit Facility and Extended Fund Facility package approved for Bangladesh on Jan. 30 are likely to boost the country’s outlook among its creditors, including Saudi Arabia, and demonstrate its capacity to pay back.

Unlike other regional countries, such as crisis-hit Sri Lanka and Pakistan, Bangladesh did not ask the fund for a bailout loan. The approved arrangements are a stabilization package to fund structural reform, ensure balance-of-payment stability, and a stable and sustainable economic position.

“The IMF granting of $4.7 billion will be helpful in providing positive signals to our development partners that the fundamentals of the Bangladeshi economy remain strong, and that Bangladesh is also ready to take up reforms,” Rahman said.

“From that perspective, it will also be helpful in projecting to Saudi Arabia that while we are asking for deferred payment, the Bangladeshi economy will be able to sustain good foreign reserves and when the negotiated time comes, we will be able to pay.”

Besides taking the pressure off its dollar reserves, the extended credit on oil supplies would also help Bangladesh with energy security. The South Asian nation, which is dependent on imported liquefied natural gas, has been struggling with an energy crisis in recent months.

Since mid-July, the government has been resorting to daily power cuts amid high global prices driven up by Russia’s war in Ukraine.

Industries that do not receive sufficient power to run their operations have been forced to remain idle for several hours a day. In early October, about 80 percent of Bangladesh’s 168 million people were left without electricity after a grid failure caused by fuel shortages to over a third of the country’s gas-powered units.
Saudi Arabia supplies more than half of Bangladesh’s crude imports.

“We are bringing in oil, which is our regular, normal import, because our transport sector is fully dependent on this oil, and also partially our production,” said Prof. Mohammad Tamim, dean of chemical and material engineering at Bangladesh University of Engineering and Technology.

Importing energy and ensuring its uninterrupted supply are crucial to keeping the Bangladeshi economy afloat and helping it stabilize while other reforms requested by the IMF are implemented to fix structural problems.

“There is a lot of pressure in terms of importing energy products, so it’s very important that we keep supplying oil so that there is no disruption in economic activity,” Tamim said.

“Deferred payment will definitely help Bangladesh in tackling the dollar crunch now.”

Why Bangladesh is seeking Saudi oil on credit after IMF success

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[bluesky]

Why Bangladesh is seeking Saudi oil on credit after IMF success

Why BAL cronies like you are should cheat others? BD is begging SA because a mere $450 million IMF loan in 2023 will not make the country rich with dollars.

Hasina Bibi and her cronies like S. Alam have already stolen the FE reserves and made BD with the ranking of SL and Pakistan.

Please grow some shame before you start a thread on false presumptions. Please re-read the news below about the FE demands made by the IMF.

IMF sets BD forex reserve cap at $24.4bn for June'23

https://www.dhakatribune.com/economy/2023/02/04/imf-sets-forex-reserve-cap-at-244bn-for-june23 IMF sets forex reserve cap at $24.4bn for June'23 In December this year the reserve position must stand at least at $26.81 billion, both the figures will be checked in the first two reviews Bigstock...

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