MONTHLY FISCAL-MACRO UPDATE

December, 2011

Prepared by: Macroeconomic Wing Finance Division

This issue is contributed by .Sheikh Touhidul Haque, Senior Assistant Secretary, Finance Division. Tanvir Bashar, Assistant Chief, Finance Division.
Guided by: Dr. Mohammad Tareque Secretary Finance Division Ministry of Finance Issue-11, Year: 2011 As on January 25, 2012

MONTHLY FISCAL-MACRO UPDATE

A. FISCAL SECTOR
a.1 Revenue Earnings
Fiscal Year 2009-10 2010-11 Growth (%) 2011-12
December July- December

(Taka in crore) Tax Revenue NBR 59396 76322 28.5 7,376 39,314 Non-NBR 2743 3229 17.72 289 1,617 (9.85%) Non-Tax Revenue 13420 11767 -12.32 3,767 10,614 (64.79%) Total Revenue 75559 91318 20.86 11,432 51,545 (24.81%)

(Growth over July- December FY '11) (17.76%)

Source: Integrated Budgeting & Accounting System (iBAS), Finance Division.

Chart 1: Monthly Trend of Revenue earnings (FY10-FY12)

12000 10000 C r o r e T a k a 8000 6000 4000 2000 0
A u g u s t Ju ly

S e p te m b e r

N o ve m b e r

D e ce m b e r

F e b ru a ry

Ja n u a ry

O c to b e r

M a rc h

NBR FY 10 Non-NBR & NTR FY 11

Non-NBR & NTR FY 10 NBR FY 12

NBR FY 11 Non-NBR & NTR FY 12

In FY2010-11 growth of total revenue was 20.86 percent. Up to December FY12, NBR Tax revenue growth was 17.76 percent. o o Non-NBR Tax revenue increased by 9.85 percent Non-Tax revenue decreased by 64.79 percent.
(Taka in crore) Growth (%) 61.93 2011-12
December

a.2 Grants
2009-10 3217.5 2010-11 1224.8 July- December 841.1

Growth over July- Dec FY 11 (%)

725.5

Source: Integrated Budgeting & Accounting System (iBAS), Finance Division.

Ju n e

A p ri l

M a y

MONTHLY FISCAL-MACRO UPDATE

a.3 Government Expenditure
2009-10 1.Non-Development Interest Domestic Foreign Subsidies & Transfer 2. ADP 3. Development Program Financed from Rev. Budget 4. Non-ADP FFW
5. Net Outlay on Food A/C

(Taka in crore)
2010-11 81372.0 15151.9 13729.0 1422.9 31081.6 33001.3 835.5 4200.0 5026.4 7329.3 124794.0 Growth (%) 2011-12 December 10590.9 1827.9 1455.6 372.3 3006.9 2756.9 55.4 0.1 501.4 1734.1 14233.6 July- December 41160.6 8289.8 7783.4 506.4 14931.4 10557.2 87.3 27.2 4371.6 5914.0 62062.4

73164.4 14868 13497 1371

11.22 1.91 1.72 3.79 15.27 17.38

4.17

Current

26964 28113.9 802.09 927.9 -849.9 931.3 101604.0

352.63 417.55
686.97

6. Loans & Advances Total**

21.52

Source: Integrated Budgeting & Accounting System (iBAS), Finance Division. Figures in parentheses indicate growth over July, FY 10. ** excludes non-ADP projects, structural adjustment

Up to December FY 12, Total expenditure records a growth (growth: 59.61%), of which Subsidies and transfer (growth: 52.26 %) Interest payments (growth: 28.53%).
Chart 2: Monthly Trend of ADP and Non-ADP Expenditure (FY 10-FY12)
20000 18000 16000 14000 12000 ADP 10000 8000 6000 4000 2000 0
Se pt em be r ov em be r D ec em be r Ja nu ar y Fe br ua ry ct ob er Au gu st M ar c Ju ne h Ap ri l Ju ly M ay

14000 12000 10000 8000 6000 4000 2000 0 Non-ADP

ADPFY10

Non-ADP FY10

ADPFY11

Non-ADP FY11

ADPFY12

Non-ADP FY12

MONTHLY FISCAL-MACRO UPDATE

a.3.1 Structure of Revenue Expenditure

Chart a.3: Sectorwise share(%) of Non-Development expenditure up to December FY12

Hlth 5.7% Edu 18.0% Other 37.9% POS 8.4% Defence LGRD 12.9% 1.5% SSW 2.9% Housing RCRA 0.7% 1.2% FE 0.0% Agri IES 13.5% 0.5% Trans 3.5% Interest 20.4%

GPS 11.0%

GPS = General Public Services, LGRD = LGD, RD & Cooperatives, CHTs, POS = Public Order and Safety, Edu = Education and Technology, Hlth = Health, SSW = Social Security and Welfare, RCRA = Recreation, Culture and Religious Affairs, Agri = Agriculture, Fisheries and Livestock, Land, Water Resources and Food, FE = Fuel and Energy, IES = Industries, Jute, Textiles, Commerce, Labor & Overseas, Trans = Transport and Communication

Sector wise revenue expenditure shows that highest expenditure is in Interest payment (20.4%) followed by education (18.0%), defense (12.9%). General Public Service (11.0%)

a.3.2 Structure of ADP Expenditure

Chart c.3: Sectoral Share(%) of Development Expenditure up to Dec. FY2012

50 30 10 -10 A11 Sector's Share in % A12:Sector's Share In % (up to Dec) Admn 5.0 2.4 SIS 51.5 39.6 PIS 31.9 46.7 Agr 8.6 8.4 Other 3.1 2.9

Admn = General Public Services, Defence, and Public Order and Safety, SIS = Social Infrastructure, covers Edu, health, Housing and SSW & LGRD. PIS = Physical Infrastructure, covers FE and Trans; and Others include RCRA and IES

MONTHLY FISCAL-MACRO UPDATE

Sector wise ADP expenditure shows that, up to December FY12 highest shares are in Physical Infrastructure (46.7%) and next highest expenditure is in Social Infrastructure (39.6%).

a.4 Budget Balance

Overall Balance 2009-10 2010-11 2011-12
December *

(Taka in crore) Overall Balance as % of GDP -3.60 -3.28 -0.31 -1.16 -25699.5 -33475.6 -2779.8 -10399.9

Up to December *

Source: Integrated Budgeting & Accounting System (iBAS), Finance Division. * excluding grants

a.5 Deficit Financing

External (net) 2009-10 2010-11 2011-12
December *

Domestic Bank -2092.5 25210.2 -711.2 15520.6 Non-Bank 17911.7 3570.6 638.4 -6661.2

Total Financing 21854.8 31013.2 146.7 7666.5

(Taka in crore) Financing as % of GDP -4.70 -3.29 0.09 -0.21

6035.6 2232.5 219.5 -1192.8

July- December *

Source: Integrated Budgeting & Accounting System (iBAS), Finance Division. *including BPC ** excluding BPC
Deficit Fianacing as % of GDP

Nonbanking

Banking Ite m

Domestic

Foreign

Total -1.0 0.0 1.0 2.0 % of GDP Account 2009-10 Account 2010-11 Accounts 2011-12 (up to Dec.) 3.0 4.0 5.0

MONTHLY FISCAL-MACRO UPDATE

a.6 Net Sales of NSD Certificates
Sales Repayment Net Sale (Taka in crore) Outstanding at the end of period 61381.42 63438.32 3.35 63772.39 63772.39 (+0.66)

2009-10 20010-11 Growth 2011-12

December

25553.69 17232.03 -33.17 1080.31 8009.48 (-12.36)

13963.06 15175.13 8.68 1316.56 7675.41 (+7.05)

11590.63 2056.90 -82.25 -236.25 334.07 (-83.04)

July- December
Growth over July- December FY11
Source: National Savings Directorate.

Up to December of FY12, net sale was decreased by 83.04 percent than that of the previous fiscal year.

B. MONETARY SECTOR
b.1 Monetary and credit development
(Taka in crore)

Outstanding Stock at the end of period 2009-10 2010-11 Growth (%)

Net Foreign Asset Net Domestic Asset

67073.70 295957.50 340213.70 69453.00 54392.30 15060.70 270760.70 363031.20

70620.00 369899.90 433525.90 92813.20 73436.10 193.77.10 340712.90 440519.90

5.29 24.98 27.43 33.63 35.01 28.66 25.84 21.34

Domestic credit Public Sector Govt. (net)

Other Public Sector

2011-12p Growth(%) over December July- December, FY11 66871.7 4452.6 (-5.33%) 408625.20 6132.6 (24.34%) 481538.9 9046.3 (25.94%) 110296.3 -359.8 (54.39%) 275.3 -635.1 9404.1 10673 90995.8 (73.46%) 19300.50 (1.7%) 371242.6 (19.4%) 475496.9 (19.09%)

Private Sector Broad Money

Source: Bangladesh Bank. p. Provisional

At the end of December FY12, broad money growth stands to 19.09 percent. Growth in Net Foreign Asset is -5.33 percent.

MONTHLY FISCAL-MACRO UPDATE

Growth in Govt. (net) 73.46 percent Growth in private sector credit is 19.4 percent.

b.2 Reserve money and money multiplier

Outstanding Stock at the end of period 2009-10 2010-11 Change 2011-12 (December ) Reserve money Reserve Money multiplier 80510.30 4.51 97500.90 4.52 16990.6 0.01 215.9 4.78
p

Change over July- December '11 99374.2 0.28

Source: Bangladesh Bank.

C. EXTERNAL SECTOR c.1 Export

2009-10 2010-11
December

(In million US$) 2011-12

July-December

Export Growth (%)

16204.65 3.95

22924.38 41.47

2064.85 3.85

11774.60 14.72

Source: Export Promotion Bureau. *Growth over the same period of the previous fiscal year.

Chart 6 : Monthly Trend of Exports

2500 2300 2100 m ilio nU S $ 1900 1700 1500 1300 1100 900
S ep te m be r O ct ob e r N ov em be r D ec em be r F eb ru ar y Ja nu ar y M ar ch A ug us t Ju ne Ju ly A pr il M ay

FY11 FY12

FY10

MONTHLY FISCAL-MACRO UPDATE

c.1.1 Structure of Exports
Chart 7: Structure of Exports (July-December,2011-12)
Other Products 9% Engineering Products 1% Agricultural Products 2% Knitwear 41% Woven Garments 38% Chemical Products 1% Jute and Jute Goods 4% Frozen Food 3% Leather 1%

Up to December of FY12, export earnings increased by 3.85 percent over the same period of previous year.

c.2 Imports (c & f)

2009-10 2010-11
December

(In million US$) 2011-12 July- December 17817.40 16.91 18207.11 -5.82 17428.90 16.09

Import payments Growth (%) LCs Opened Growth (%) LCs Settled Growth (%)

23738.40 5.47 28783.40 32.01 23053.10 7.50

33657.50 41.79 38581.12 34.04 31952.18 38.60

2910.50 -2.47 2519.82 -23.89 2478.63 -13.02

Source: Bangladesh Bank. p-provisional; Growth rate (in percent) over the same period of the previous fiscal year.

Chart 8: Monthly Trend of Import Payments

3500 3000 m illio nU S $ 2500 2000 1500 1000
S ep te m b e r O ct o b e r N o ve m b er D ec em b e r Fe b ru a ry A u g u st Ja n u a ry M a rc h Ju n e Ju ly A p ri l M a y

FY11 FY12

FY10

MONTHLY FISCAL-MACRO UPDATE

In FY 11, import payments increased by 41.79 percent compared to the previous fiscal year. However, up to December FY 12, import payment increased by 16.91 percent, LCs opened decreased by 5.82 percent and LCs settled increased by 16.09 percent compared to the same month of FY 11. C.2.1 Structure of Imports (Based on LCs settled)
Chart 9: Structure of Imports (Based on LCs settled, July-Dec FY'12)
Others 14% Consumer Goods 10%

Petroleum & Petro. Product 14%

Machinery for misc.industries 9%

Intermediate Goods 9% Capital Machinery 7% Industrial Raw Materials 37%

9 Import of intermediate goods increased by 54.91 percent. 9 Import of industrial raw materials decreased by -0.92 percent. 9 Import of capital machinery increased by 23.31 percent and machinery for misc. industry increased by 14.27 percent. 9 Import of petroleum and petro products increased by 130.48 percent. c.3 Remittances
2008-09 2009-10 2010-11

(In million US$) 2011-12

December

July- December 6068.30 9.33 51.54

Remittances Growth (%) As % of GDP As % of Export

9689.26 22.42 10.82 62.25

10987.40 13.40 11.06 67.80

11650.32 6.03 11.72 50.82

1147.22 18.38 55.56

Source: Bangladesh Bank, EPB. p. provisional, - indicates data are not available

MONTHLY FISCAL-MACRO UPDATE

Chart 10 : Monthly Trend of Remittances FY12 FY11 M illio nU S $ 1000

1200

800

FY10

600
O ct o be r N o ve m be r D e ce m be r A ug us S t ep te m be r Ja nu a ry F eb ru ar y M ar ch Ju ne Ju ly A pr il M ay

In FY2010-11 remittances inflow records a moderate growth of 6.03 percent. In FY11 remittances as percent of GDP and Export were 11.72 percent and 50.82 percent respectively which are relatively higher than previous fiscal year.

Up to December FY12, remittances inflow recorded a growth of 9.33 percent compared to the same period of FY11.

c.4 Exchange Rate Movement

Average 2007-08 2008-09 2009-10 2010-11 2011-2012 July August September October November December
Source: Bangladesh Bank

End of the period 68.52 69.06 69.445 74.15

68.60 68.80 69.18 73.88

74.48 74.41 74.57 75.72 75.14 79.67

74.71 73.62 75.23 76.20 76.48 81.85

MONTHLY FISCAL-MACRO UPDATE

Chart 11: Period Average Exchange Rate (TK-US$) movement during last 12 month
82.0 80.0 78.0 T a k a 76.0 74.0 72.0 70.0 68.0 66.0

Ja nu ar y' 11 Fe br ua ry '1 1

Exchange rate of Taka per US$ increased to Tk. 79.67 at the end of December, 2011 from Tk.74.48 at the end of July, 2011. Taka depreciated by 6.97 percent as of end December, 2011 over end July, 2011.

c.5 Foreign Exchange Reserve

2009-10 Reserve In month of import payment
Source: Bangladesh Bank.

A ug us t'1 S 1 ep te m be r'1 1

2010-11 10911.55 3.89

As on end of December '11 9634.85 3.31

10749.74 4.5

The gross foreign exchange balances held abroad by commercial banks stood at US$ 9634.85 million by end December, 2011 against US$9285.20 million by end November, 2011.

On the basis of average import payment during July 2011 to December 2011, the foreign exchange reserve is equivalent to 3.31 months import payments.
Chart 12: Outstanding Stock of Gross Foreign Exchange Reserve at the end of the month (January , 2011 to December, 2011)
12000 10000

m illio nU S $

8000 6000 4000 2000

A ug us t'1 S 1 ep te m be r'1 1 O ct ob e r'1 1 N ov em be r'1 1 D ec em be r '1 1

0
'1 1 F eb ru ar y' 11 M ar ch '1 1 Ju ne '1 1 Ja nu ar y A pr il' 11 M ay '1 1 Ju ly '1 1

10

O ct ob er '1 N 1 ov em be r'1 1 D ec em be r'1 1

M ar ch '1 1

M ay '1 1

A pr il'1 1

Ju ne '1 1

Ju ly '1 1

(In million US$)

MONTHLY FISCAL-MACRO UPDATE

c.6 Balance of Payments
2010-11 2009-10 Trade Balance Current Account Balance Capital Account Financial Account Overall Balance -5155 3724 512 -651 2865
2010-11 (JulyDecember)

(In million US$)

2011-12p (JulyDecember)

-7328 995 600 -1584 -925

-3448 865 357 -1694 -268

-4195 409 224 -805 -998

Source: Bangladesh Bank. p- provisional

Chart 13: Com par ative Sce nar io of BOP Statis tics (July-De c FY11 and July-De c FY12) 2000 1000 0 m illio nU S $ Trade Balance -1000 -2000 -3000 -4000 -5000 July-Dec FY11 July-Dec FY12 Current Account Balance Capital Account Financial Account Overall Balance

In FY11, Current Account Balance had a surplus of US 995 million, which was US$ 3724 million in the same period of the previous fiscal year.

Current account balance records a surplus of 409 million US$ during July-December of FY12, which was 865 million US$ in the same period of the previous fiscal year.

D. REAL SECTOR
d.1 Gross Domestic Product
2006-07 GDP at constant prices Growth (%) Agriculture Industry Service GDP at current prices 302971 6.43 4.56 8.38 6.92 472477 2007-08 321726 6.19 3.20 6.78 6.49 545822 2008-09 340197 5.74 4.12 6.46 6.32 614795
(Taka in Crore )

2009-10 360047 5.83 4.67 6.01 6.38 692380

2010-11p 384885 6.66 4.96 8.16 6.63 787495

11

MONTHLY FISCAL-MACRO UPDATE

Growth (%) GNI at current prices Per capita GDP (Tk.) Per capita GNI (Tk.) Per capita GDP (US$) Per capita GNI (US$) 13.65 507752 33607 36116 487 523 15.52 594212 38330 41728 559 608 12.60 670696 42628 46504 620 676 12.62 758684 47405 51945 685 751 13.42 852822 53236 57652 755 818

Source: Bangladesh Bureau of Statistics. R- Revised.

Real GDP growth in FY2010-11 was 6.66 percent of which Growth in Agriculture as per revised was 4.96 percent Growth in Industry is estimated 8.16 percent Service sector growth is estimated at 6.63 percent.

Per capita GDP in FY2010-11 exceeded US$ 750 mark and reached to US$ 755.
GDP growth rate at current and constant prices

18 16 14 12 10 8 6 4 2 0
19 99 -0 0

13.65 11.33 10.02 7.91 6.94 7.75 10.78 12.14

15.52 12.62 12.64 13.43

G ro w th (% )

6.63 5.26 6.27 5.96 6.43

6.19

5.74 5.83

6.66

5.94

5.27

4.42

Year
Current Price Constant Price

d.2 Quantum Index of Industrial Production (Large and Medium Scale Manufacturing Industry, Base: 1988-89=100)
FY 2006-07 2007-08 2008-09 2009-10 2010-2011 October '10 October '11P
Source:BBS; R:revised; P:provisional
P

Index 360.33 386.48 413.42 442.12

Growth Rate 9.74 7.27 6.97 6.94

461.10 533.23

12

20 10 -1 1p

20 08 -0 9 20 09 -1 0r

20 01 -0 2

20 02 -0 3

20 03 -0 4

20 04 -0 5

20 05 -0 6

20 06 -0 7

20 07 -0 8

20 00 -0 1

MONTHLY FISCAL-MACRO UPDATE

The growth rate of the Quantum Index of Industrial Production (Large and Medium Scale Manufacturing Industry) was 6.94 percent in FY 10 which was 6.97 percent in FY 09. In June10, the average index stood at 482.66 which was 8.43 percent higher compared to the same period of June09. In October11, the average index was 533.23 which was 15.6 percent higher compared to October10.

d.3 Consumer Price Index and Inflation (National)

FY 2006-07 2007-08 2008-09 2009-10 2010-11 2010-11
September October November December January February March April May June

CPI (General) 176.04 193.54 206.43 221.53 241.02 National 7.20 9.94 6.66 7.31 8.80

Twelve-Month Average Basis Food Non-Food 8.11 5.90 12.28 6.32 7.19 5.91 8.53 5.45 11.34 4.15

236.53 238.68 238.89 240.75 242.48 244.28 245.97 246.24 246.39 249.11 254.72 259.66 264.85

Twelve-Month Point to Point Basis 7.61 9.72 6.86 8.43 7.54 9.80 8.28 11.01 9.04 11.91 9.79 12.77 10.49 13.87 10.67 14.36 10.20 13.16 10.17 12.51 10.96 11.29 11.97 13.40 12.70 13.75

3.69 3.82 3.33 3.27 3.85 4.36 4.32 3.97 4.78 5.73 6.46 8.76 8.77

2011-12
July August September

13

MONTHLY FISCAL-MACRO UPDATE

October

November
December

265.94 266.55 266.34

11.42 11.58 10.63

12.82 12.47 10.40

9.05 10.19 11.38

Source: Bangladesh Bureau of Statistics.

Chart 16: Inflation Rate of Last 12 Months
16 14 12 10 8 6 4 2 0 Non-Food General Food

General

In FY11 the average rate of inflation (Twelve-Month Average Basis) recorded at 8.80 percent. The food and non-food inflation were 11.34 percent and 4.15 percent respectively. In December FY11, the rate of inflation (General) on point-topoint basis stood at 8.28 percent which increased substantially to 10.63 percent in December FY12. However, the food and nonfood inflation were 11.01 percent and 3.21 percent respectively during the same period of FY11. In December of FY12, the rate of inflation (national) on point-topoint basis was 10.63 percent, of which, food and non-food inflations were 10.40 percent and 11.38 percent respectively (Table d3 above).

14

Ju nl y' 11 A ug us t'1 S 1 ep te m be r'1 1 O ct ob e r'1 1 N ov em be r'1 D 1 ec em be r '1 1

Food Non-Food

Ja nu ar y' 11 F eb ru ar y' 11

M ar ch '1 1

Ju ne '1 1

A pr il' 11

M ay '1 1