FINANCING COOPERATION : Dhaka, Beijing to sign agreement

Dhaka and Beijing plan to ink a deal on ‘financing cooperation’, to boost their development relations and promote Chinese concessional loans in major infrastructure areas in Bangladesh. The proposed deal, on which both Eximbank of China and economic relations division of the finance ministry had a number of meetings last month, is expected to be signed by next month, a senior finance ministry official said. ‘We are working on the proposed agreement as the draft agreement remains specific and action-oriented towards Chinese financing and project selection,’ Asif-uz-Zaman, additional secretary, ERD, finance ministry told New Age. ‘The proposed deal would strengthen mutual understanding on working procedures and promote working efficiency of each side.’ China initiated the move to sign the agreement with South Asian nations including Bangladesh as Chinese government is keen to provide nearly US$ 20 billion in soft loans to these countries by the next three years, sources said. The draft agreement said ERD every year will send a list of priority projects to Eximbank of China for investment. ‘Projects in the areas of energy, transportation, and telecommunication sectors shall be considered a priority,’ reads the draft agreement. ‘In order to ensure smooth and efficient operation of the cooperation mechanism, each party shall establish a working team responsible for regular communication and correspondence,’ the deal added. The projects in the project list shall be divided into two categories, the draft agreement said, adding, ‘first category project means the projects to be started within one year after submission of the project list, second category projects means the projects to be started within two to three years.’ ‘First category projects shall be relatively mature, which means that the feasibility report, environmental impact analysis report, commercial contract and other relevant evaluation documents have been completed and obtained, or could be completed and obtained within three months after submission of the project list,’ reads the draft deal further. Officials concerned in the finance ministry said the latest move by Beijing would ensure their footprint in the Bangladesh economy in a more specific way, as the world’s second largest economy has long lobbied to invest in the country’s Sonadia deep sea port. ‘The proposed agreement will have project names with time-bound programmes to make the government more transparent and committed towards project implementation,’ a top finance ministry official said. He said the government right at the moment sought to implement 10 large infrastructure projects at a cost of nearly $US 12 billion Chinese concessional loans under its preferential buyer’s credit scheme. The deal once signed between the two countries would infuse dynamism among policy makers of Bangladesh and spur the growth momentum in local economy, the official said. News Courtesy: www.newagebd.net