The New Nation - Internet Edition

NATION BUSINESS REPORT

Country's balance of payments (BoP) surplus fell 68.5 percent to $64 million in July-September 2008 compared with $203 million in the same period the previous year, the Bangladesh Bank said.

The current account surplus increased to $366 million during the period from $99 million previously, due to bigger inflow of remittances, the BB data shows.

However, the financial account balance stood at a deficit of $55 million against a $34 million surplus.

Imports for July-September increased by 35 percent from a year earlier, while exports rose 43 percent, bringing the trade deficit to $1.35 billion from $1.18 billion in the same period of previous year.

Officials said strong remittances from more than 5 million Bangladeshis working overseas helped offset the impact of the trade shortfall and kept the overall balance of payments in surplus.

Bangladesh received $2.3 billion in remittances in July-September, up from $1.6 billion the previous year.

The BB's foreign exchange reserves increased to $5.86 billion at the end of September 2008 compared with $5.16 billion at the end of September 2007.

The BB officials said the balance of payments surplus is likely to rise in the coming months as import costs come down due to drops in international commodity prices amid the worst global economic downturn since 1930s.

On the other hand, they said, demand for key ready-made garment exports and inflow of remittances, two mainstay of the impoverished country's economy, were unlikely to be affected immediately by the global financial squeeze.