Bangladesh eyes ‘reset, reform, restart’ after U.S. delegation visit

DHAKA — Bangladesh’s new caretaker government has wrapped up its first key diplomatic meeting with a call to “reset, reform and restart” after a student-led uprising ousted longtime Prime Minister Sheikh Hasina last month.

Interim leader Nobel Laureate Muhammad Yunus and other officials held talks in Dhaka on Sunday with a six-member delegation including Donald Lu, the U.S. government’s assistant secretary for South Asia, and Brent Neiman, deputy undersecretary for international finance at the Department of the Treasury.

Lu is a well-known figure in the South Asian nation, having made multiple visits including before polls in January when Hasina — who fled to neighboring India last month — clinched her fourth consecutive term in an election boycotted by the opposition and marred by irregularities.

During the high-level talks this weekend, Yunus outlined the myriad challenges ahead, including revitalizing the stumbling economy and a push to reform key institutions including the electoral system, judiciary and police.

He also emphasized a commitment to recovering assets embezzled by individuals associated with the previous government. “We were mired in corruption,” Yunus said in a statement that added officials would push to “reset, reform and restart.”

Bangladesh — ranked 149th of 180 nations on Transparency International’s 2023 Corruption Perceptions Index — has sought help from the FBI and the United Nations Office on Drugs and Crime (UNODC) to recover billions of dollars in missing state funds.

Yunus’ finance advisor, Salehuddin Ahmed, told reporters on Sunday that there were talks with the U.S. delegation on repatriating stolen money. The new government has estimated about $100 billion was illegally moved out of the country over the past 15 years, primarily through trade mis-invoicing and an informal money transfer network known as hundi.

This estimate is supported by a 2021 Global Financial Integrity report that noted an average annual outflow of $8.3 billion between 2009 and 2018. Hasina was in power from 2009 until last month.

The U.S. delegation said Sunday it would support Bangladesh’s inclusive economic growth and institutional reforms, pledging an additional $202 million in aid through the U.S. Agency for International Development (USAID).

This comes after a 2021 agreement when USAID pledged $954 million in aid to Bangladesh through 2026, of which $425 million has already been disbursed.

At the same time as the U.S. delegation’s visit, the World Bank and the Asian Development Bank announced on Sunday that they would provide Bangladesh with $2.5 billion in loans to support reforms in the banking and financial sectors.

The World Bank will allocate $1 billion of the total amount, while the ADB will contribute $1.5 billion.

Bangladesh last year sought a $4.7 billion bailout from the International Monetary Fund (IMF) and is now asking for another $5 billion to fill up its depleted foreign exchange reserves.

“A high-level delegation could signal significant support for the Yunus government, especially in the form of crucial economic aid that Bangladesh urgently needs,” Shafquat Rabbee, a U.S.-based geopolitical columnist, said of Sunday’s meetings.

The U.S. embassy in Dhaka emphasized the significant presence of American companies in Bangladesh, a major clothing exporter, that it said on social media could unlock the country’s “growth potential through trade and investment,” given “the right economic reforms in place.”

Shahab Enam Khan, a professor of international relations at Jahangirnagar University in Dhaka, told Nikkei Asia that Washington would back efforts at “fostering an inclusive and equitable economy supported by accountable institutions and good governance.

“The delegation’s message aligns with the public’s desire for effective governance and sustainable democratic institutions, and it reflects the U.S.’s ongoing engagement with emerging geopolitical players in the Indo-Pacific, such as Bangladesh.”

source : asia.nikkei