Committee for apparel sector readies recommendations
Wednesday, 11 November 2009
FE Report
A high-profile committee decided Tuesday to put a number of recommendations including providing of loan re-scheduling facilities until June 2010 for helping the country's apparel sector that faced the global financial meltdown.
Held at the finance ministry with committee head eminent economist M Syeduzzaman in the chair, the meeting also decided to recommend exemption of the existing Tk 500,000 renewal fee on captive/standby generators.
The government earlier formed a committee to find out ways to help the export sector especially ready-made garments (RMG) industries against the backdrop of the global recession.
Presidents of Bangladesh Garment Manufacturers and Exporters Association
(BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA), senior officials from the ministry of finance and the Bangladesh Bank, and concerned government officials were present in the meeting.
The meeting also decided to raise Export Development Fund under the central bank to US$ 10 million from earlier $ 2.0 million for facilitating the back-to-back letters of credit (LCs).
The meeting formed two separate committees to settle the dispute that arose over fixation of LIBOR rate and extension of time for recovering term loan.
The committee proposed a LIBOR plus 2.5 per cent rate of interest against the existing rate of 1.0 per cent, a meeting source told the FE.
It also decided to recommend a 5.0 per cent export performance bonus on the shipment of apparel items to new markets for helping diversify the country's apparel market.
The meeting also recommended a gradual decrease in such export performance bonus.
It, however, favoured a 5.0 per cent cash subsidy for the small sized clothing units whose exports vary between $1.0 million and $ 5.0 million a year.
The committee also suggested that the apparel sector retain the existing facilities.
The committee proposed to form a crisis management fund worth Tk 5.0 billion to be contributed to by the apparel sector and the government.
The BGMEA president told the FE: "We praise the idea but there should be necessary modalities before the creation of such fund."
About the committee's recommendations, he said: "We want policy support from the government to make the sector competitive."
He also said: "We wanted subsidy in diesel for running captive power generators against the backdrop of frequent power outages."
The government on October 15 last formed the nine-member committee to place necessary recommendations before it for helping the apparel sector that faced the fallout of the global financial meltdown.
A high-profile committee decided Tuesday to put a number of recommendations including providing of loan re-scheduling facilities until June 2010 for helping the country's apparel sector that faced the global financial meltdown.
Held at the finance ministry with committee head eminent economist M Syeduzzaman in the chair, the meeting also decided to recommend exemption of the existing Tk 500,000 renewal fee on captive/standby generators.
The government earlier formed a committee to find out ways to help the export sector especially ready-made garments (RMG) industries against the backdrop of the global recession.
Presidents of Bangladesh Garment Manufacturers and Exporters Association
(BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA), senior officials from the ministry of finance and the Bangladesh Bank, and concerned government officials were present in the meeting.
The meeting also decided to raise Export Development Fund under the central bank to US$ 10 million from earlier $ 2.0 million for facilitating the back-to-back letters of credit (LCs).
The meeting formed two separate committees to settle the dispute that arose over fixation of LIBOR rate and extension of time for recovering term loan.
The committee proposed a LIBOR plus 2.5 per cent rate of interest against the existing rate of 1.0 per cent, a meeting source told the FE.
It also decided to recommend a 5.0 per cent export performance bonus on the shipment of apparel items to new markets for helping diversify the country's apparel market.
The meeting also recommended a gradual decrease in such export performance bonus.
It, however, favoured a 5.0 per cent cash subsidy for the small sized clothing units whose exports vary between $1.0 million and $ 5.0 million a year.
The committee also suggested that the apparel sector retain the existing facilities.
The committee proposed to form a crisis management fund worth Tk 5.0 billion to be contributed to by the apparel sector and the government.
The BGMEA president told the FE: "We praise the idea but there should be necessary modalities before the creation of such fund."
About the committee's recommendations, he said: "We want policy support from the government to make the sector competitive."
He also said: "We wanted subsidy in diesel for running captive power generators against the backdrop of frequent power outages."
The government on October 15 last formed the nine-member committee to place necessary recommendations before it for helping the apparel sector that faced the fallout of the global financial meltdown.