Bangladesh’s finance minister AHM Mustafa Kamal has been recognised as the finance minister of the year 2020 by the US’s ‘The Banker’ newspaper. The Banker provides economic and financial intelligence for the world's financial sector and has built a reputation for objective and incisive reporting since 1926. The Banker's Finance Minister of the Year 2020 awards celebrate the officials that have best managed to stimulate growth and stabilise their economy.
Kamal was selected as the top finance minister from the Asia-Pacific region. He was awarded for his role as finance minister with the aim of building up the country’s economy by opening it up to foreign investment, the Banker said. Bangladesh has already seen an impressive rate of economic growth in recent years, reaching 8 percent over the past two years.
While the country was ranked 41st in the Centre for Economics and Business Research’s World Economic League Table 2019 global rankings, it has forecast that Bangladesh will become the 24th largest economy in the world by 2033. “After attaining an economic growth rate of more than 7 percent for three consecutive years, Bangladesh achieved an 8.15 percent growth rate in the fiscal year 2019. The country also made remarkable progress in the improvement of socio-economic indicators such as poverty reduction, health, education and women’s empowerment,” Kamal told The Banker.
To achieve the consistent 7 percent or above growth rate needed to hit this target requires the country to rethink how it operates.
Kamal has been instrumental in attracting international support for the country by pushing for greater levels of foreign direct investment, according to The Banker’s award citation. Turkey has been highlighted as a location for increased investment, with the electronics, medicine and gas industries all positioned as presenting opportunities.
He has also looked to attract more investment from Japanese companies, promising to assist them with issues around VAT, tax and policy. Support is also forthcoming from the development banks. The Asian Infrastructure Investment Bank pledged to continue supporting Bangladesh, with Kamal outlining projects covering energy, connectivity and social development – with a specific focus on education – being the key targets for support in the coming years.
“According to the Asian Development Bank, Bangladesh attained the highest gross domestic product [GDP] growth rate in the Asia-Pacific region [in 2019],” Kamal said. “Strong macroeconomic stability has been the hallmark of success of the economy. Inflation came down to 5.6 percent and the country has very low debt-to-GDP ratio of 34 percent.” Taking Bangladesh into the capital markets for the first time is another of Kamal’s ambitious moves.
The first ever taka-denominated bonds were issued in November 2019, and the Bangla bond was launched at the London Stock Exchange and issued through the International Finance Corporation. The three-year bond was oversubscribed at Tk800m ($9.42m). Issuing the local currency bond has set a benchmark, and raised the possibility of a sovereign local currency bond.
Internet access across the country has also been a priority, thanks to Kamal’s belief that it is possible to provide lower cost fibre optic internet access by using the infrastructure of the Trans-Asian Railway. Bangladesh has seen an increase in the number of remittances made into the country: money sent home by overseas workers is one of the country’s main sources of foreign exchange.
The government had introduced a 2 percent cash incentive to encourage people to send money back home, and to do so through legitimate channels, a move that Kamal believes will see a 25 percent increase on remitted sums during the 2019-20 financial year.
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