The central bank issued a policy on merchanting trade for the first time in Bangladesh to boost inflow of foreign exchange through expediting services incomes, officials said Wednesday.
Under the maiden policy, traders are now free to purchase goods or services from another country and export those to a third country without needing to submit both export-and import-declaration forms to the authorities concerned.
From now on, local traders are eligible for merchanting trade, like Singapore and Hong Kong, they explained.
"All the authorized dealer (AD) banks will satisfy themselves to the effect that payments for import-leg are to be met out of payments received from export-leg," says a notification issued Wednesday by the Bangladesh Bank (BB).
In accordance with the existing export policy, the central bank defined merchanting trade as a trade for which goods or services procured from a country are shipped or delivered directly to a third country.
"We've issued the policy to help boost inflow of foreign exchange through enhancing service incomes in the near future," a senior BB official told the FE while explaining the main objective of the policy.
The central banker also expects that such trading mechanism will contribute to improving the country's foreign-exchange-reserve situation.
The latest BB moves come against the backdrop of falling trend in the country's foreign-exchange reserves in the last couple of months - following higher import-payment obligations amid global price rises.
However, the central bank is providing the US dollar as foreign-currency liquidity support to the scheduled banks continuously for managing the forex-market bucks.
As part of the ongoing moves, the BB sold $40 million more directly to three state-owned commercial banks (SoCBs) on Wednesday at Tk 96.00 to help them meet a growing demand for the greenback as global price rises have led to import-cost escalation with its resultant pressures on reserves of Bangladesh, as also of many other countries.
Earlier on Tuesday, the central bank provided similar amount of the greenback to two SoCBs on the same ground.
The BB has so far injected $2.90 billion from the reserves directly into commercial banks as liquidity support for import payments in the current fiscal year (FY), 2022-23.In FY22, the central bank sold$7.62 billion from the reserves to the banks for the same purpose.
Bangladesh's forex reserves came down to$37.14 billion on Wednesday from $37.20 billion of the previous day following higher sales of the greenback to feed the market.
On the other hand, the interbank rate for the US dollar remained unchanged at maximum Tk 106.90 on Wednesday from the previous level, according to market insiders.
The interbank rate for the US dollar was ranging between Tk 102.37 and Tk 106.90 on Tuesday, according to the Bangladesh Foreign Exchange Dealers' Association (BAFEDA).
Marker operators predict that the interbank rate may fall slightly in the coming days ahead following adjustment of the previous rates.
Meanwhile, the weighted average rate for the sale of bills for collection, better known as BC, for settling import payments stood at Tk 103.33 on the day against Tk 103.30 of the previous working day, a senior member of the BAFEDA said.
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