The United States is set to commence high-level economic talks with Bangladesh's interim government this week, including discussions with interim leader Muhammad Yunus.
The Financial Times reports, the meetings, scheduled for September 14 and 15 in Dhaka, mark the first significant economic dialogue between the US and Bangladesh since a student-led protest movement led to the ouster of long-serving leader Sheikh Hasina, who has since fled to India.
Muhammad Yunus, the 84-year-old Nobel laureate, microlending pioneer, and founder of Grameen Bank, assumed the role of chief adviser to the interim government last month. He is expected to participate in these crucial discussions alongside other senior Bangladeshi officials.
The US delegation will be led by the Treasury Department and will include representatives from the State Department, the US Agency for International Development (USAID), and the Office of the US Trade Representative.
“The United States is optimistic that, through the implementation of necessary reforms, Bangladesh can address its economic vulnerabilities and lay a foundation for sustained growth and increased prosperity,” said Brent Neiman, Assistant US Treasury Secretary for International Finance, in a statement to the Financial Times.
Neiman emphasised that the US aims to “underscore support for Bangladesh’s continued engagement with the IMF and other international financial institutions” as the country seeks to strengthen economic growth through financial sector reforms, improved fiscal sustainability, and reduced corruption.
Bangladesh, once a prominent regional economic performer, sought a $4.5 billion bailout from the IMF in 2022 following disruptions caused by the COVID-19 pandemic and the war in Ukraine. These global events led to soaring energy and import costs.
The upcoming discussions will address fiscal and monetary policies, the health of the financial system, and involve meetings with representatives from the private sector.
The fall of Sheikh Hasina’s government last month, after weeks of violent protests that resulted in approximately 500 deaths, significantly impacted South Asia’s second-largest economy and its crucial garment sector. The upheaval disrupted the industry, leading some international chains to shift orders to rival producers in Southeast Asia.
The US has urged Bangladesh to implement reforms in the garment industry, including decriminalizing trade unions. Yunus has also advocated for labor reforms to boost garment production and attract more orders.
Hasina’s ousting was met with jubilation by her opponents, who viewed her as a tyrant. However, the development has raised concerns in India, a key supporter of the ousted leader, as it appears to advance US foreign policy objectives that could undermine India’s regional influence.
This shift has reignited old tensions between the US and India, which supported Sheikh Hasina’s father, Sheikh Mujibur Rahman, during Bangladesh’s 1971 war of independence, while the US backed Pakistan. Last month, the US State Department denied any involvement in Hasina’s resignation. “Any implication that the United States played a role in Sheikh Hasina’s departure is absolutely false,” said Vedant Patel, a State Department spokesperson.