LOCAL ECONOMY

 Debates over leasing NCT to foreign operator intensifying

  May 20, 2025

• The discussion over leasing Chittagong Port's New Mooring Container Terminal (NCT) to a foreign operator is getting intense. Political parties like BNP, Jamaat-e-Islami, and leftist groups are opposing the move, arguing that the terminal is already fully functional and doesn't need foreign management. They believe bringing in an external operator is unnecessary and could lead to revenue loss.

• On the other hand, government officials support the idea, suggesting that a global operator could enhance efficiency and bring in advanced technology. They argue that such a partnership could modernize port operations and maximize financial returns. The final decision is pending the results of an ongoing feasibility study. (Read more)

 Joblessness rises amid dull investment

 May 20, 2025

• Bangladesh's unemployment rate climbed to 4.63% in Q4 2024-25, up from 3.95% the previous year, with the number of unemployed individuals reaching 2.7 million. This increase is attributed to sluggish private investment, high inflation, and political uncertainties, leading to limited job creation despite a growing youth population

• The labor force participation rate also declined to 48.41% from 50.27% a year earlier, indicating that many potential workers are discouraged by the lack of employment opportunities. Economists highlight that the downturn in industrial employment, despite export growth, suggests a trend of jobless growth, raising concerns about the country's ability to leverage its demographic dividend. (Read more)

 Nagad barred from bank transfers

 May 20, 2025

• Bangladesh Bank has instructed all banks to halt fund transfers involving Nagad, while allowing its mobile financial services to continue. This decision aims to safeguard customer funds following governance issues within Nagad.

• The central bank's appointed administrator for Nagad was sidelined by a court order, leading to former director Md Shafayet Alam assuming the CEO role despite facing fraud charges. Authorities allege that Nagad's previous management created approximately Tk 650 crore in e-money without actual monetary backing, raising serious concerns about financial irregularities. (Read more)

 Oilseed cultivation surges amid high edible oil prices

 May 20, 2025

• Farmers in southern Bangladesh are increasingly turning to oilseed cultivation, driven by volatile edible oil prices. In Barishal, oilseed farming expanded by 44.7% over the past three years, with soybean production reaching approximately 67,956 tonnes on 43,072 hectares in the 2023–24 season. Sunflower cultivation also saw significant growth, particularly in Barguna, where it increased by 224 hectares, totaling 3,600 hectares this year.

• Farmers like Rabeya Begum from Kalapara have capitalized on this trend, cultivating sunflowers on previously fallow land and expecting earnings between Tk 30,000–35,000. Similarly, Mehedi Hasan from Bauphal extracts and sells around 450 liters of sunflower oil annually at Tk 350 per liter, supplementing his income. (Read more)

 Financial scams: Frozen fortunes to fund victim compensation

 May 20, 2025

• The government plans to use money and assets seized from alleged embezzlers and money launderers to compensate victims of financial scams. This includes frozen bank accounts and company shares. The initiative aims to prioritize victims, especially depositors affected by financial wrongdoings

• A high-level meeting, chaired by Chief Adviser Prof Muhammad Yunus, discussed the creation and transparent management of the compensation fund. Bangladesh Bank Governor Ahsan H Mansur emphasized that the fund would serve the public interest, offering relief to both scam victims and the poor. (Read more)

  Star Interview: Betting on a leaner budget

 May 20, 2025

• The government plans to cut back on big, costly projects—like Payra Port—and instead focus on smaller, labour-heavy ones. Think road repairs, river digs. The goal? Create more local jobs and keep money circulating in rural areas. Less flash, more grassroots impact.

• Also, they're tightening the belt on borrowing. The aim is to lower the country's debt risk from "moderate" to "low." That means fewer loans, more efficient spending. They're even reviewing tax breaks—keeping only the ones that truly help. It's all about making the budget smarter and more sustainable (Read more)

 ADP implementation lowest in five years

 May 20, 2025

• Bangladesh's Annual Development Programme (ADP) implementation rate has dropped to 41.31% in the first 10 months of FY2024–25, marking the lowest in five years. This decline from 49.26% in the same period last year indicates slower progress in development projects

• The Health Services Division has utilized only 14.9% of its allocated funds, highlighting a critical shortfall in implementing health-related development activities. This underperformance raises concerns about the effectiveness of public health initiatives. (Read more)

 RMG export to EU rises 29% in Jan-Mar

 May 20, 2025

• Bangladesh's ready-made garment (RMG) exports to the European Union (EU) experienced a significant boost in the first quarter of 2025. The country exported garments worth $5.98 billion during January–March, marking a 29% increase compared to the same period in 2024. This growth reflects a strong demand for Bangladeshi apparel in the EU market.

• The rise wasn't just in value; the volume of exports also grew by 24.64%, and the average unit price increased by 3.55%. This balanced growth in quantity and price indicates Bangladesh's competitive edge in the EU apparel market. (Read more)

Revenue may take a hit as customs activity halves amid pen-down strike

 May 20, 2025

• Chattogram port's operations have slowed down significantly due to a pen-down strike by customs officials. Over 4,000 containers are now stuck, and the number of processed bills of entry has halved. This disruption is causing major delays in trade and could lead to a drop in government revenue.

• The ongoing strike is not just a minor hiccup; it's a big deal. With customs activities reduced by half, the government's revenue stream is taking a hit. The longer this continues, the more it could impact the economy. (Read more)

 Upcoming budget follows previous govt’s framework, say economists

 May 20, 2025

• Economists note that the upcoming budget sticks closely to the previous government's framework, with no significant changes—just minor adjustments. They express concern that without substantial reforms, the budget may not effectively address current economic challenges.

• Dr. Debapriya Bhattacharya emphasizes that the budget's success depends on political dialogue, credible elections, and structural reforms. He warns that without these, the budget may lack the necessary impact to drive meaningful economic progress. (Read more)

 Bangladesh reducing import duties on over 100 goods to appease Trump

  May 20, 2025

• In response to the United States' imposition of additional tariffs, Bangladesh's interim government is set to lower import duties on more than 100 items in the upcoming budget. This move aims to create a favorable ground for negotiations with the U.S., as the tariff cuts would primarily benefit American imports.

• The government also plans to implement several tax policy changes, including increasing the individual tax-free income threshold and removing tax exemptions in sectors like fisheries, dairy, and poultry. Additionally, a minimum tax of Tk 5,000 will be imposed on all individual taxpayers within the tax net, and the highest personal tax rate will be raised to 30 percent. (Read more)

 STOCK MARKET BD

 Stocks open positive amid hopes of market recovery

 May 20, 2025

• Investor sentiment improved, with early trading showing gains across major indices as hopes rise for a market recovery.

• Traders seem optimistic about potential government or regulatory steps to stabilize the market after weeks of sharp declines. (Read more)

 Sukuk oversubscribed 4 times in 6th auction

 May 20, 2025

• In the 6th auction, Bangladesh’s Sukuk (Islamic bond) was oversubscribed by 4 times. That means way more investors wanted in than expected—strong sign of confidence.

• The government planned to raise Tk 5,000 crore, but bids came in at around Tk 19,000 crore. This shows rising interest in Shariah-compliant investment tools. (Read more)

 Stocks plunge to 5-year low despite govt promises to support market

 May 20, 2025

• Bangladesh's stock market has plunged to its lowest point in five years, despite government assurances to support the market. Investors are selling off shares in key sectors like food, non-bank financial institutions, telecom, and banking, leading to significant pressure on market indices

• The continued decline in stock prices has shaken investor confidence. Despite government promises, the lack of effective measures to stabilize the market has led to increased sell-offs, exacerbating the downward trend. (Read more)

Akij Food to raise Tk 500cr thru zero-coupon bond

 May 20, 2025

• Akij Food and Beverage Limited (AFBL) is set to raise Tk 500 crore through a zero-coupon bond to fund its expansion plans. The five-year bond aims to enhance trade operations, improve cash flow management, and diversify funding sources beyond traditional bank financing

• This strategic move reflects AFBL's forward-looking financial approach and introduces a secure investment instrument for Bangladesh's growing investor community. The bond issuance underscores the company's commitment to innovation and its role as a key player in the country's fast-moving consumer goods sector. (Read more)

GLOBAL ECONOMIC HEADLINES

 Reserve Bank of Australia Cuts Rate as Global Risks Rise (WSJ)

China Cuts Benchmark Lending Rates (WSJ)

BOJ Finds Wide Range of Views on Bond Buying Reduction Plans (Bloomberg)

Hong Kong Dollar Funding Cost Drops in FX Intervention Aftermath (Bloomberg)

Asian stocks inch higher, Aussie dips as RBA cuts rates (Reuters)

Japan is sticking to demand for US to eliminate tariffs, trade envoy says (Reuters)

Australia dollar slips as RBA cuts rates, warns on global outlook (Reuters)

 Thailand Eyes $15 Billion Cut in US Trade Gap With Export Rules (Bloomberg)

US-India Trade Deal Unlikely to Be Major Market Driver, Bernstein Says (Bloomberg)

 GLOBAL MARKET

 US Stock Rally Set to Stall as Tariff Risks Linger: Markets Wrap (Bloomberg)

Pfizer Licenses 3SBio Cancer Drug for Record $1.2 Billion (Bloomberg)

Honda Walks Back EV Investment, Sales Targets on Poor Demand (Bloomberg)

Investments in Latin American startups up 26% in 2024, to rise again in 2025, study says (Reuters)

JPMorgan CEO Jamie Dimon says markets are too complacent on tariffs, expects S&P 500 earnings growth to collapse (CNBC)

BofA flags potential rise in EUR/USD hedging by corporates (investing.com)

Xiaomi begins mass production of Xring O1 chip for new devices (investing.com)

Vodafone forecasts flat profit amid German turnaround (investing.com)

 DISCLAIMER

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