About Scheme on Improvement of Fiscal Forecasting Through Development of Macroeconometric Model

Scheme at a Glance

NAME OF THE SCHEME	Improvement of Fiscal Forecasting through Development of Macro econometric Model
COMPONENT: 1	REVENUE AND EXPENDITURE FORECASTING
ADMINISTRATIVE MINISTRY/DIVISION	Finance Division, Ministry of Finance
IMPLEMENTATION DEPARTMENT/AGENCY	Macroeconomic Wing, Finance Division
NAME OF THE PIT HEAD	Rehana Perven ; Additional Secretary, Finance Division
NAME OF THE PEC	Ms. Tanima Tasmin (Additional Charge)
TOTAL COST OF THE SCHEME	8 m US $ (39.06 Crore BDT)
IMPLEMENTATION PERIOD	6 Years 6 Months; January 1, 2020 to June 30, 2026

 

Objective of the Scheme

Macro-Fiscal Forecasting is:

1.  To create a comprehensive macroeconomic dataset;
2.  To prepare a macroeconomic forecasting model suitable for Bangladesh.
3.  This Macro-econometric forecasting model would help budget preparation and the medium-term Macroeconomic framework (MTMF).

Output of the Scheme

1. Finalizing the requirements of the macro-econometric model as applicable for Bangladesh;
2. Setting the foundation based on which the experts will prepare a macro econometric model suitable for Bangladesh and has been approved by the Senior Secretary, Finance Division, Ministry of Finance.
3. The approved version of macro econometric model requirement has been sent to the SPFMS office and the World Bank office respectively.

Outcome of the Scheme

1. The full dataset required for the Macroeconomic model is complete.
2.  Datasets for four key macro sectors (real, monetary, external, and fiscal) have been collected.
3.  It spans 38 years and contains one hundred variables of yearly frequency data on Gross Domestic Product (GDP) and its components from national accounts.
4.  This dataset is being used to produce a systematic and robust revenue and expenditure forecast.
5.  The dataset has been used by MEW to generate revenue and expenditure forecasts during the updating situation of the MTMF through the Coordination Council meetings.

Major Achievement of the Scheme

• The requirements for the Macro-Economic Model have been finalized;
• Data sharing agreement has been signed with the data source agencies such as BB, NBR, BBS, NSD, GED, Programming Div., EPB, ERD.
• E-views software has already been procured.