Myanmar starts trade with BD thru' ACU mechanism

FE Team | Published: February 14, 2012 00:00:00 | Updated: February 01, 2018 00:00:00

Siddique Islam
Myanmar has started business with Bangladesh through direct banking channel to help expand and expedite bilateral trading activities between the two neighbouring countries, officials have said.
Under the latest move, Myanmar's businessmen have opened two letters of credit (LCs) with the state-owned Sonali Bank Limited under the existing Asian Clearing Union (ACU) mechanism.
The Ministry of Commerce on Sunday last organised a meeting on the expansion of Bangladesh-Myanmar bilateral trade activities, with its Secretary M Ghulam Hossain in the chair.
An executive of the Sonali Bank Limited informed the meeting about opening of the LCs under the ACU settlement mechanism, which earlier used to be settled through the use of the third-country banks.
"A new window has been opened on expansion of the bilateral trade between the two countries," a senior official at the Ministry of Commerce (MoC) told the FE Monday while explaining the latest developments in the bilateral trade.
He also said payments for foreign trade earlier were settled between the two countries through a third country like Singapore or Thailand.
The meeting also decided to hold two seminars -- one in Dhaka and another in Chittagong - to be organised by the Bangladesh-Myanmar Chamber of Commerce and Industry (BMCCI).
"We'll invite four to five Myanmar banks to participate in the seminars on building up awareness about the ACU mechanism," vice president of the BMCCI SM Nurul Hoque told the FE.
Bangladesh earlier requested Myanmar for taking initiatives for opening LCs with its commercial banks directly, instead of any third country.
The ACU is an arrangement among Bangladesh, Bhutan, India, Iran, Myanmar, Nepal, Pakistan, Sri Lanka and the Maldives, through which intra-regional transactions between and among the participating central banks are settled on a multilateral basis.
Mr. Hoque, also director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said a single-country trade fair would be held in Yangoon this year to attract Myanmar's businessmen to importing Bangladeshi products.
The volume of bilateral trade between the two countries has been quite 'insignificant' for years because of lack of proper initiatives. The balance of trade, according to officials, has tilted in favour of Myanmar over the past fifteen years.
However, a review of bilateral trade between the two countries showed that the trade balance was in favour of Bangladesh from 1991-92 to 1995-96. But in 1996-97, it started tilting towards Myanmar.
Bangladesh exported goods and commodities worth only US$ 9.65 million to Myanmar in 2010-11 while its imports from the latter during the period stood at $175.72 million.
Dhaka mainly exports pharmaceutical products, leather, woven garments and other manufacturing goods to Yangoon and imports wood articles, vegetable products, prepared food and fish from there.