Understanding foreigners key to efficient cross-border trade

With an increase in international trade of Bangladesh, efficient cross-border trade will have notable implications for its LDC graduation process. It is, therefore, imperative to understand the country's foreign business partners.

International trade finance landscape is also facing increasing risks due to geopolitical tensions and complex regulations such as new US sanctions targeting specific jurisdictions.

Mahbubur Rahman, president, International Chamber of Commerce (ICC) - Bangladesh, said this as the chief guest at the concluding session and certificate-giving ceremony of a daylong workshop styled 'Trade Finance Legal Challenges and International Sanctions Regime & Requirements'.

To effectively manage these risks and reduce the risk inherent to trade-based money laundering (TBML), according to him, a connected risk and compliance approach to cross-border trading and finance is essential.

The ICCB co-hosted the event with Moody's and ICC United Arab Emirates (UAE) at a city hotel on Saturday, according to a media statement.

Mohamed Daoud, director and industry practice lead for Moody's Financial Crime Compliance across the Middle East and India, and Vincent O'Brien, director, ICC UAE, attended the event moderated by ICCB secretary general Ataur Rahman.

At the event, ICCB president Mahbub said, "The financing of international trade transactions plays a crucial role in facilitating global commerce."

However, it operates within a complex legal framework shaped by regulatory requirements, including sanctions, presenting significant challenges for financial institutions and businesses dealing with international trade.

Therefore, according to the ICCB president, financial institutions and businesses must navigate a labyrinth of sanctions imposed by various jurisdictions.

These sanctions can target specific countries, entities or individuals, and often differ between regions, leading to complexities in ensuring compliance.

Highlighting the role of lending organisations, Mr Mahbub said banks were obligated to conduct thorough due diligence to prevent money laundering and terrorist financing.

This involves verifying the identities of clients and understanding the nature of their business activities, which can be resource-intensive and legally complex.

Mr Mahbub said the evolving geopolitical landscape, which introduced new sanctions, has increased the compliance burden on banks and businesses engaged in international trade.

To navigate these challenges, he added, financial institutions and businesses should establish comprehensive policies, follow regulatory requirements and educate employees on the latest developments in sanctions laws and compliance obligations.

Some 106 participants from different government agencies like the Financial Institutions Division, banks, financial institutions and international agencies took part in the event.

There were four sessions on different topics-modern trade finance, risk management, international sanctions, and TBML.

A similar workshop was also held in Chattogram on Sunday.