Though the credit and
debit are written balanced in the balance of payment account, it may not remain
balanced always. Very often, debit exceeds credit or the credit exceeds debit
causing an imbalance in the balance of payment account. Such an imbalance is
called the disequilibrium. Disequilibrium may take place either in the form of
deficit or in the form of surplus.
Disequilibrium of Deficit
arises when our receipts from the foreigners fall below our payment to
foreigners. It arises when the effective demand for foreign exchange of the
country exceeds its supply at a given rate of exchange. This is called an
'unfavourable balance'.
Disequilibrium of Surplus
arises when the receipts of the country exceed its payments. Such a situation
arises when the effective demand for foreign exchange is less than its supply.
Such a surplus disequilibrium is termed as 'favourable balance'.
Role of IMF: If an IMF-member country is experiencing severe balance of
payments difficulties and reserve depletion is advanced that country may
request assistance from the IMF. Under this approach the IMF may provide a loan
to the country in exchange for macroeconomic policy conditionality. IMF
financing, usually with structural adjustment-related financing support from
the multilateral development banks or other donors, involves commitment to
appropriate economic stabilisation policy objectives, provides for economic and
balance of payments adjustment and seeks to avoid a crisis, allowing the
capacity for loan repayment to develop within a reasonable period of time.
After the Second War
World a new international institution’ International Monetary Fund (IMF)’ was
set up for maintaining equilibrium in the balance of payments of member
countries for a short term. Membercountries borrow from it
for a short period to maintain equilibrium in the balance of payments. IMF also
advises member countries how to correct fundamental disequilibrium in the
balance of Payments when it does arise
Therefore, Bangladesh had
to face great difficulties with regard to balance of payments. At several
occasions it approached IMF to bail it out of the foreign exchange crisis that
emerged as a result of huge deficits in the balance of payments. At long last,
economic crisis caused by persistent deficits in balance of payments forced
Bangladesh to introduce structural reforms to achieve a long-lasting solution
of balance of payments problem.