A panel discussion and the closing session of ICC workshop on 'Operation of Open Account and International Factoring for Foreign Trade of Bangladesh' was held in Dhaka on Sunday. Deputy Governor of Bangladesh Bank Ahmed Jamal (centre) was present as the chief guest and keynote speaker while Muhammad A. (Rumee) Ali, ICC Bangladesh Banking Commission Chairman, moderated the session. AK Azad (5th from right), Vice President ICC Bangladesh, also spoke. Factoring in Bangladesh has still been very limited, whereas factoring in most other regions of the world has exploded with the shift towards open account trade.
ICC Bangladesh Vice President AK Azad said this at a panel discussion and the certificate award ceremony of the ICC Bangladesh workshop on 'Operation of Open Account and International Factoring for Foreign Trade of Bangladesh' held at a city hotel on Sunday, says a press release.
Mr Azad said that in the context of on-going global financial and economic crisis, banks and businesses need to take stringent measures to ensure that their sales transactions are watertight.
Open account and international factoring are being adopted by most of the countries around the world for better and smooth trade finance, he added.
He also said Bangladesh has made a strong economic recovery from the Covid-19 pandemic. The export income is increasing and is successfully advancing overcoming all hurdles.
During FY '22, the ready-made garment (RMG) export was $42.62 billion, which is about 82 per cent of the total export of $52.08 billion. The country is poised to overtake China in garments export to EU. Bangladesh's share in global RMG, market is only 6.50 per cent as against China's 32.21 per cent, he added.
Mr Azad mentioned that BGMEA is targeting to export US$100 billion worth of garment items by 2030. Besides, there is immense potential for Bangladesh to increase its export of leather goods, pharmaceuticals, plastic products and other products.
He observed that Bangladesh Bank's circular on 'conditional open account transactions' is a good initiative. It is now more than two years that open account transactions has been allowed by Bangladesh.
He suggested undertaking studies on the impact of this decision as well as consider the possibility of allowing conditional open account for import as well. ICC Bangladesh can work together with Bangladesh Bank in this regard, he added.
"Bangladesh government is promoting digitisation to make Smart Bangladesh. Therefore, we would suggest appropriate policy changes should be made by Bangladesh Bank to digitise international trade. We, from ICC Bangladesh, will be delighted to support Bangladesh Bank in implementing DSI developed by ICC HQ," Mr Azad said.
Mr Ahmed Jamal, deputy governor of Bangladesh Bank, in his keynote speech, mentioned that Bangladesh Bank after huge exercises brought radical changes in foreign trade transactions by issuance a circular on June 30, 2020.
Bangladesh Bank is always committed to provide policy supports to our exporters and importers, he mentioned.
Given the ongoing situation due to Covid-19 pandemic, Bangladesh Bank extended policy supports to international trade by the ways of (a) extending repatriation of export proceeds, (b) extension of usance periods of import payments including back to back LCs, (c) EDF loan repayment extended to 360 days, (d) refinancing from EDF for normal back to back LCs and so on, the deputy governor added.
He observed, "Even during the pandemic situation we are being visited by several international financing institutes. This indicates that we are growing despite different odds."
He said that he is sure external financiers will be benefited from trade transactions of Bangladesh. He requested the exporters to use the policy so as to protect their payments.
Dr Md Akhtaruzzaman, director general, Bangladesh Institute of Bank Management (BIBM) and Peter Mourly, secretary general, Factor Chain International, the Netherlands, also spoke while ICC Bangladesh Secretary General Ataur Rahman delivered the welcome address.
Muhammad A. (Rumee) Ali, ICC Bangladesh Banking Commission Chairman, moderated the session.
Other panelists were Md Fazlul Hoque, managing director, Plummy Fashions Limited; Mohammad Hatem, executive president, BKMEA & managing director, MB Knit Fashion Ltd; Muhammad Mohsin Reza, general manager, Supply Chain of SKF Pharmaceuticals Limited; Naser Ezaz Bijoy, president, Foreign Investors' Chamber of Commerce & Industry (FICCI) and chief executive officer, Standard Chartered Bank; Ahmed Shaheen, additional managing director, Eastern Bank Limited; and Dr Prashanta Kumar Banerjee, professor, Bangladesh Institute of Bank Management (BIBM).
A total of 131 participants, including officials of Ministry of Commerce and Bangladesh Bank, 96 participants from 31 banks and 32 participants from 24 companies attended the day-long workshop.
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