Media Center

News Release

ADB Helping Bangladesh Cope with Rising Food Prices

DHAKA, BANGLADESH (04 August 2008) – The Asian Development Bank (ADB) and the Government of Bangladesh today signed loan agreement of $170 million to cope with the rising food prices.

The loan forms a part of the Government’s $1.29 billion broader food security package, which is being supported by ADB and other international agencies. ADB is also providing a $600,000 grant to help the Government improve its ability to plan and undertake medium-and long-term interventions to improve food security.

ERD Joint Secretary Monwara Begum signed for the Government while Nurul Huda, Officer-in-Charge of ADB’s Bangladesh Resident Mission, signed the loan agreement on behalf of ADB at a ceremony at ERD, Sher-e-Bangla Nagar, Dhaka today.

The assistance will help the Government to ensure access to food for those hardest hit by recent natural disasters in Bangladesh and the rapid increase in food prices. The Project will provide short-term transitional support to help the Government meet unexpected high expenditures for safety net programs based on the needs assessment conducted jointly with other development partners.

Bangladesh is the first developing member-country to receive ADB support after the announcement made during the institution’s 41st Annual Meeting in May by ADB President Haruhiko Kuroda of the provision of up to $500 million in immediate budgetary support to the hardest hit countries in Asia and the Pacific, and an increase in lending for agriculture and rural development to more than $2 billion in 2009.

Bangladesh, a net importer of food grains, was severely affected by two floods and a devastating cyclone in the second half of 2007, causing a rice production shortfall of 1.2 million tons and adversely affecting the food security of an estimated 25 million people. Rapidly increasing food prices further worsened the situation, seriously affecting the poor and vulnerable and fixed income earners. Soaring food prices have led to serious hardship for the poor, who allocate about 70% of their total spending on food.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. In 2007, it approved $10.1 billion of loans, $673 million of grant projects, and technical assistance amounting to $243 million.

Contacts