Cabinet okays proposal to form Sovereign Wealth Fund

Cabinet okays proposal to form Sovereign Wealth Fund

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Dhaka, Feb 6 – The Cabinet on Monday approved a proposal for the formation of Sovereign Wealth Fund with an authorised capital of $ 10 billion, aiming to utilise the country’s foreign currency reserve in multifaceted ways.The approval to the proposal, moved by the Finance Division, came from the regular weekly meeting of the Cabinet held at Bangladesh Secretariat here with Prime Minister Sheikh Hasina in the chair.
Briefing reporters after the meeting, Cabinet Secretary Mohammad Shafiul Alam said the government will form the fund primarily with $ 2 billion from the country’s foreign currency reserve.
“Later, the amount of the fund will be raised to $ 10 billion in phases taking $ 2 billion every year from the reserve money,” he said adding that there will be no adverse impact on the country’s economy due to this.
Shafiul Alam said the government could utilise the Sovereign Wealth Fund for the development of any sector considering the greater interest of people. “Necessary laws and rules as well as befitting structures will be framed for the purpose later,” he added.
The Cabinet Secretary explained that such fund is needed especially in case of matching fund with development partners in support of the government’s part of finance to implement any project taking loans from foreign banks or development partners.
He also said the government will also be able to meet any emergency through this Sovereign Welfare Fund.
Mohammad Shafiul Alam said the Cabinet was also apprised about the process and the impacts of final report on mutual evaluation in resisting money laundering and terror financing.
He said the final report on the 3rd phase mutual evaluation of Bangladesh was adopted at the Asia Pacific Group of Money laundering meeting held on September 7 last year in the USA where there was a big achievement of Bangladesh.
In the past, the Cabinet Secretary said Bangladesh had no certification for resisting money laundering but with the adoption of various measures, Bangladesh has now reached in a better position.
According to the report, out of the 40 recommendations of the Financial Action Task Force, Bangladesh gained in compliant ratings in implementing 6 recommendations, the country received largely compliant ratings in 20 recommendations, while got partially compliant ratings in 14 recommendations.
Besides, out of the 11 Immediate Outcomes (IO), Bangladesh got substantial ratings in one IO, moderate rating in 6 IOs and low-level rating in 4 IOs.
Shafiul Alam also said Bangladesh could have fallen into the list of risky countries category had the country could not improve at least two out of its six moderate IOs to substantial level.
“Now we can claim that we’re doing very well in resisting money laundering, and now there is no money laundering from Bangladesh,” he added.
Ministers and state Ministers, and secretaries concerned were present. – UNB

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