The latest data published by BB continue to point to a weakening in the country's balance-of-payments position. In the first seven months of 2010/11 the current-account surplus stood at US$428m, compared with US$2.1bn in the year-earlier period (on a monthly basis the current account turned negative in November 2010). The deterioration reflects a growing deficit on the trade account, in which the import bill has risen amid high global prices for oil and food as well as strong domestic demand. In the first eight months of 2010/11 merchandise imports surged by 41.8% year on year, to US$21bn.

The deterioration in the country's balance-of-payments position also reflects a somewhat stagnant transfers balance, dominated by inflows of workers' remittances, which has not swelled as fast as the government would have liked. In the first nine months of 2010/11 workers' remittances increased by just 4% year on year, to US$8.6bn, a significant slowdown when compared with an increase of 20% in the year-earlier period. The slowdown is not wholly attributable to recent political upheavals in the Middle East and North Africa, which have led to a deterioration in the business environment in that region and have thrown hiring plans of many firms into disarray. The slowdown in workers' remittances is also a reflection of a downward trend in the number of Bangladeshi workers taking up employment, a trend that began in 2008/09.

Nevertheless, policymakers are concerned about the possible repercussions of the fluid political situation in the Middle East and North Africa. Bangladesh depends on workers' remittances from the Middle East much more than any other country outside that region. Two-thirds of Bangladesh's recorded remittances, equivalent to US$7.2bn in 2009/10, originated in the Middle East. Pakistan also relies heavily on inflows of workers' remittances from the Middle East, where 70% of its total remittances come from. But total remittances account for only 6% of Pakistan's GDP, compared with 12% in Bangladesh.

The government has persisted with its efforts to increase the number of workers taking up employment abroad. On April 1st Sheikh Hasina urged the authorities in Bahrain, where 150,000 Bangladeshis work at present, to recruit more Bangladeshi workers. The country's officials are also trying to persuade the government in Saudi Arabia, Bangladesh's single-largest overseas labour market by far, to hire more of its workers. Manpower firms and businesses in Saudi Arabia stopped hiring Bangladeshi workers on a large scale two years ago. According to figures from the Bureau of Manpower, Employment and Training, over 7,000 Bangladeshis were employed in Saudi Arabia in 2010, significantly less than the some 132,000 who took up employment in the kingdom in 2008. Meanwhile, Libya, Bangladesh's fastest-growing overseas labour market (although it accounts for only a small share of total remittances) has stopped hiring amid that country's ongoing conflict.