Moody’s Negative Report Impacts Foreign Investment in Bangladesh

During a recent visit to Washington, Bangladesh Bank Governor Dr. Ahsan H. Mansur commented on the report, alleging that Moody’s quickly downgraded Bangladesh’s credit rating after the interim government took office following the Awami League government’s departure. Although economic indicators later improved, Moody’s did not update the rating.

The Governor stated, “We are now in a good position in terms of balance of payments,” yet Moody’s is not acting fairly. He urged the agency to reassess and update the country’s credit rating.

According to Moody’s report, deterioration in asset quality, high inflation, and weak economic growth make the future of Bangladesh’s banking sector uncertain. As a result, the agency downgraded the country’s credit rating from B1 to B2 with a negative outlook.

Meanwhile, the International Monetary Fund (IMF) has indicated that Bangladesh may be allowed to receive up to $8.44 billion in foreign loans this fiscal year. Economists, however, believe that the crisis will persist until an elected government is in place.

Economist Dr. Jamal Uddin Ahmed said ongoing political instability discourages investors from taking risks. Therefore, to attract investment, the police and military must ensure law and order. Governor Dr. Ahsan H. Mansur described Moody’s failure to update information as “like putting poison in food.” The current situation is seen as a major challenge for Bangladesh’s economy, highlighting the urgent need to restore investor confidence.