Opening of fresh import LCs falls drastically
Friday, 19 December 2008
Siddique Islam
Opening of fresh letters of credit (LCs) for imports drastically fell by over 44 per cent during the second week of December against the corresponding period of the previous year.
"The opening of LCs against imports has fallen significantly mainly due to declining trend in the prices of commodities in the global market," a senior official of the Bangladesh Bank (BB) told the FE Thursday.
He also said such falling trend may continue for sometime following the global financial crisis that has already hit different countries across the world.
Import LCs worth US$ 510.26 million were opened during the period as against $924.19 million of the same period of last year, according to the central bank statistics released Thursday.
"Most of the importers are now following the wait-and-see strategy for avoiding any financial risk. As a result, the opening of fresh LCs against imports has dropped recently," the BB official added.
The opening of LCs for import of some essential items, including rice, wheat, pulses and onion declined in terms of value with the falling trend in prices of the commodities in the international market persisting, officials said.
During the period, opening of LCs for rice dropped by $12.84 million to $6.58 million in terms of value while LCs for wheat declined by $32.27 million to $8.02 million, pulses by $7.38 million to $8.11 million and onion by $9.73 million to $3.28 million, the BB's data showed.
Bankers see the importers are still hesitant in importing essential commodities due to the falling trend in prices in the international market.
"The opening of fresh LCs for imports has dropped because of declining trend in prices of commodities in the global market and also because of the upcoming general election," a senior official of a private commercial bank told the FE.
He also said the opening of LCs against imports may increase after the parliamentary election scheduled for December 29.
Opening of fresh letters of credit (LCs) for imports drastically fell by over 44 per cent during the second week of December against the corresponding period of the previous year.
"The opening of LCs against imports has fallen significantly mainly due to declining trend in the prices of commodities in the global market," a senior official of the Bangladesh Bank (BB) told the FE Thursday.
He also said such falling trend may continue for sometime following the global financial crisis that has already hit different countries across the world.
Import LCs worth US$ 510.26 million were opened during the period as against $924.19 million of the same period of last year, according to the central bank statistics released Thursday.
"Most of the importers are now following the wait-and-see strategy for avoiding any financial risk. As a result, the opening of fresh LCs against imports has dropped recently," the BB official added.
The opening of LCs for import of some essential items, including rice, wheat, pulses and onion declined in terms of value with the falling trend in prices of the commodities in the international market persisting, officials said.
During the period, opening of LCs for rice dropped by $12.84 million to $6.58 million in terms of value while LCs for wheat declined by $32.27 million to $8.02 million, pulses by $7.38 million to $8.11 million and onion by $9.73 million to $3.28 million, the BB's data showed.
Bankers see the importers are still hesitant in importing essential commodities due to the falling trend in prices in the international market.
"The opening of fresh LCs for imports has dropped because of declining trend in prices of commodities in the global market and also because of the upcoming general election," a senior official of a private commercial bank told the FE.
He also said the opening of LCs against imports may increase after the parliamentary election scheduled for December 29.