local-business
Global lenders can’t help if reserves reach $10 billion or below, Rehman Sobhan says in ERF talk
Founder, Chairman of Centre for Policy Dialogue (CPD) and prominent economist Professor Rehman Sobhan on Monday expressed concern that Bangladesh may face severe difficulties if foreign exchange reserves keep falling and go below $10 billion.
He said this at an open conversation with the members of the Economic Reporters Forum (ERF) held in the city on Monday.
Also read: People’s comfort more important than big forex reserves: PM
Prof Sobhan said Bangladesh's foreign exchange reserves continue to slide and stood at $21.15 billion on 26 September in line with the IMF’s reserve calculation formula.
Recently the reserves decreased to $18 billion as per the global standard of reserves calculation, which may fall to $10 billion or below within a few months if this trend continues, he said.
Then global lenders like the IMF and the World Bank would not be able to help Bangladesh, he said.
Also read: Net reserves of foreign exchange as per BPM-6 below $18 billion: Economist Zahid Hussain
Prof Sobhan said the inward remittances dropped to $1.34 billion in September, the lowest in 41 months, though August saw the highest number of workers going abroad in a single month and a record 11.3 lakh in FY23.
He, however, does not believe that the overall economic situation of Bangladesh can ever be like that of Sri Lanka as Bangladesh has well export earnings and remittances.
He said that instead of sending remittance through banking channel reserves are being handled through hundi.
Also read: IMF reviewing reserves, macroeconomic condition ahead of next fund release
“So, that has become quite convenient for those who smuggle money abroad,” he said.
Prof Sobhan said that there has been a big change in the culture of the country's financial sector
“Non-repayment after borrowing has become the norm. The lower income groups deposit money in the banks while the rich take money as long-term loans and become defaulters. This tendency is growing,” he said.
He also said that in the next national election loan defaulters should not be allowed at all, but the record said they are allowed to contest by paying 4 to 5 percent of defaulted loans.
In replying to a query, he said the earnings of Bangladeshi people have increased and BMW cars are available as some people have the money to buy them.
Also read: Why Bangladesh’s forex reserves dipped to $21.15 billion? Economists cite reasons
“But which one is more necessary? Eggs or BMW, policymakers will determine it,” he said.
“There remains income discrepancy in the society,” he said.
Australia Bangladesh Chamber of Commerce and Industry elects new executive committee
Syed Moazzam Hossain and Jobayer Tansim Ahmed have been elected as President and Secretary General of the Australia Bangladesh Chamber of Commerce and Industry (ABCCI) respectively for the term of 2023-2025.
S. M. Hossain is the Managing Director of SMH Engineering Limited, SMH New Generation Apparels Ltd., SMH AGRO Industries Ltd. and Chairman of Lama Rubber Industries Limited.
He is the immediate past director of Federation of Bangladesh Chamber of Commerce & Industry (FBCCI) and former president of Bangladesh – Malaysia Chamber of Commerce and Industry (BMCCI), Bangladesh Indenting Agent Association (BIAA) and Bangladesh Rubber Garden Owners Association (BRGOA) & involved in many other organizations, said a media release.
Read: Salman F Rahman inaugurates FBCCI Innovation and Research Center
On the other hand, Jobayer Tansim is the Director of Shah Fatehullah Textile Mills Ltd., Jalal Ahmed Spinning Mills Ltd., Genvio Pharma Ltd.
He is also involved with various Chamber and Association.
The other office bearers include Deepok Kumar Baral (vice President), Jamilur Rahman (organising secretary), Mohammad Taherul Hoque (treasurer), directors Eric Samson Chowdhury, Nabeel Essa, Iqbal Hossain, Md Samsul Alam Mallick, Shubhashis Chakma and Md. Al Amin.
Read more: Bangladesh can be trade hub for ASEAN, South Asia: FBCCI
BGMEA, Vietnam counterpart discuss potential collaboration
A high-level delegation from the Vietnam Textile and Apparel Association (VITAS), led by its Chairman, Vu Duc Giang, paid a visit to the Bangladesh Manufacturers and Exporters Association (BGMEA) in Uttara on Sunday.
The 24-member delegation also included Vice Chairmen of VITAS — Nguyen Bao Tran, Than Duc Viet and Luu Tien Chung.
During the visit, the delegation held a meeting with BGMEA President Faruque Hassan, where both parties discussed potential areas of collaboration that could bring mutual benefits to both Bangladesh and Vietnam, particularly within the textile and apparel industry.
BGMEA Director Asif Ashraf was also present at the meeting.
BGMEA urges NBR to speed up customs, bond services for RMG sector
The discussions were centered on the exchange of knowledge, experiences, and expertise aimed at advancing the textile and apparel sectors in both countries.
The Vietnamese delegation expressed keen interest in understanding the success stories of Bangladesh, especially concerning workplace safety, environmental sustainability, and circularity in the textile and apparel industry.
In the meeting, BGMEA President Faruque Hassan highlighted Bangladesh’s increased emphasis on value addition and diversification, with a particular focus on non-cotton products.
BGMEA calls for government support to safeguard RMG sector in testing times
He expressed BGMEA's interest in tapping into Vietnamese experience, particularly in the production of high-value items while Bangladesh could share its exemplary strides in the areas of workplace safety and environmental sustainability.
President Faruque Hassan also highlighted the importance of sharing knowledge and expertise through collaboration between the BGMEA University of Fashion and Technology (BUFT) and Vietnamese apparel trade associations and fashion institutes.
BGMEA president stresses timely policy to ensure growth of RMG industry
This partnership would facilitate interactions between designers and technical experts, fostering the exchange of faculties and students, ultimately leading to the development of knowledge and skills that would benefit both countries.
The exchange of knowledge, expertise, and experiences between these two industry associations could drive innovation, sustainability, and value addition in the textile and apparel sectors.Both sides expressed willingness to work together to explore avenues for cooperation that would boost the growth and prosperity of their respective industries and economies.
Robi’s sustained investment improves network experience across country
Following sustained investment, network optimization initiative, and deployment of L2600 spectrum band that the company acquired in the auction last year, customers of Robi Axiata Limited throughout the country are enjoying significantly improved data and video network experience.
Till date, Robi has deployed L2600 spectrum in 50% of the sites that were dealing with high level of data traffic. The doubling of network capacity following L2600 spectrum deployment in these areas helped to improve data speed by 50%. Going forward, further deployment of L2600 spectrum will continue to improve network experience across the country, said a press release.
Doubling of a site capacity means that the site will be able to carry double data volume with better experience. This is also enabling the VoLTE users to enjoy best quality of voice in their devices, read the release.
While improving the data network, deployment of L2600 spectrum is also ensuring Robi’s readiness to launch 5G service. Robi had acquired 60 MHz spectrum from 2600 band last year from an open auction.
Robi’s Chief Corporate and Regulatory Officer, Shahed Alam said: “Robi has long been working on improving its network quality. On an average, we have been investing around $200million over a number of years. With the deployment of L2600 spectrum, we believe our network development is now helping us to deliver a far better quality of service for our valued customers. This drive will continue across the country going forward.”
Besides, the network optimization activities directly contributed towards reducing call drop rate by around 60% over the last year for users of both- Robi and Airtel brand users. Meanwhile, the Mean Opinion Score (MOS), a parameter that indicates overall the call quality had improved by around 50% since the start of the ongoing year.
DCCI seminar: Strong SME policy can boost export capacity
Speakers in a seminar on Saturday urged to improve the capability of small and medium enterprises (SMEs) so that the sector can survive and increase exports to fight the challenges of LDC Graduation.
They said focusing on technology advancement, access to finance, marketing facilities, research and innovation, product diversification, cluster base skilled development, and infrastructure are some of the important issues for the overall development of the SME sector.
Speakers said these at a seminar on ‘Improving export capabilities of SMEs: succeeding globally upon LDC graduation’ organized by Dhaka Chamber of Commerce & Industry (DCCI) on Saturday (October 7)
Dr. Shirin Sharmin Chaudhury, MP, Speaker of the Bangladesh Parliament was present here as the chief guest.
Read: IRI-NDI pre-election assessment mission due to arrive Saturday
She said that the SMEs of Bangladesh are resilient enough and contribute more than 30 percent to the GDP. Still, this sector has various challenges and she hoped that the policymakers would try to address these issues to solve the existing problems.
She also added that despite the pandemic and the Russia-Ukraine war, Bangladesh has been able to continue its commendable progress securing 6.5 percent GDP growth.
The speaker (Dr Shirin) invited the SME entrepreneurs to utilize technology to get access to the virtual market and requested them to use the platform of Joyeeta Foundation to sell their products.
DCCI President Barrister Md. Sameer Sattar said, “We need to prepare as the exporters including SMEs will face tariffs ranging from 8 percent to 16 percent on their export after 2026. However, we have a very strong SME base in Bangladesh. SMEs contribute 28 percent to the country’s GDP, 45 percent to manufacturing value addition, and account for 90 percent of the jobs in the private sector.”
Read: Shopowners’ Association seeks immediate withdrawal of 1% supervision charge in CMSME loans
He suggested redefining SME definition by excluding ‘Medium’ businesses as a medium are largely privileged.
DCCI president also recommended banks provide SME-tailored export financing like credit insurance, export development fund, and working capital loans to address export-related financial challenges.
He also underscored the importance of having a central SME database with updated information. He also endorsed foreign investment, easy technology transfer, and cluster development for export-oriented SMEs.
Dr. Selim Raihan, Executive Director, SANEM gave the keynote presentation in the seminar. He said that Bangladesh’s SMEs face challenges like capacity constraints, lack of policies and regulatory issues, financing, infrastructure, and skills gaps.
Read more: FBCCI president says they are against dishonest businessmen
He also said that the import tariff for SMEs in Bangladesh is a bit high, so it should be investment-friendly.
Kohinoor Yeasmin, CEO of Tarango, Rezbin Begum, MD, People’s Leather Industry, AFM Asif, CEO of Bengal Meat Processing Industries Ltd, and Executive Director of Bangladesh Bank Dr. Md. Kabir Ahmed, also spoke in the seminar as panel discussants.
Walton to participate China’s 'Canton Fair' for 3rd time
Bangladeshi global electronics brand Walton for the third time is going to take part in the world's largest trade 'China Import and Export Fair,' popularly known as 'Canton Fair' around the world.
Walton is the only Bangladeshi company going to showcase 'Made in Bangladesh' labelled world-class advanced technologies consumer electronics at this prestigious trade show, said a press release.
The 134th Canton Fair autumn session will start from 15th October this year at Canton Fair Complex in the Guangzhou City.
The fair will be continued till November 4, 2023 in three phases, read the release.
Under the supervision of China's Ministry of Commerce, this mega trade show has been held in April and October every year for 66 years.
Read: Walton gets ‘Bangabandhu SheikhMujib Industrial Award-2022’
The first phase of this autumn fair will be held from 15 to 19 October where electronics and household electrical appliances, lighting equipment, vehicles and spare parts, machinery and hardware and tools products will be displayed.
Walton's Mega Pavilion will be set up at the Canton Fair's International Pavilion in the Electronics and Household Electrical Appliances category.
At the 5-day long first phase of Cantor Fair, 'Made in Bangladesh' tagged European ACC brand and Bangladeshi electronics giant Walton brand's world-class advanced appliances will be showcased at Walton pavilion. The displayable products are huge energy saving advanced features refrigerators, air conditioners featured with voice control and digital display, rechargeable fans, ceiling fans etc.
Read: Walton brings new models of single door all-rounder fridge
Walton Global Business Unit's Vice-President and Chief Coordinator of Walton Pavilion at Canton Fair Abdur Rouf said, "Walton is the only Bangladeshi company participated in Canton Fair. For the 3rd time, we are participating in this prestigious trade show. Earlier in 2016 and 2017, Walton took part in Canton Fair and gained huge success and praise from the global buyers by displaying highest standard state-of-the-art technologies consumer electronics. We hope that this time Walton will also achieve great success in the Canton Fair."
Walton Refrigerator's Chief Business Officer (CBO) Tofail Ahmed said, "Walton is now the leading electronics brand in the domestic market. Now, our target is to establish Walton as one of the best global electronics brand around the world by 2030. As a part of the initiatives for achieving that vision, we are participating in the world's renowned trade shows in different countries, including Europe and America, with the world's best quality products. We are ready to challenge any global brand with high quality products.
Read: Walton awards 144 plazas, managers for contribution to sales revenue
Walton Air Conditioner's CBO Tanvir Rahman said, "Participating in the Canton Fair will further bright the image of Walton and Bangladesh as well. Canton Fair is the world's top platform where more than three lakhs traders and buyers come from almost every country in the world. Walton will get a best opportunity for creating business relationship with those global buyers.
Walton officials who are employed in different countries are conducting promotional campaigns in their respective countries including China, United Kingdom, USA, Europe, Africa, Middle East, India, Nepal and Bhutan to attract the attention of global buyers and also invite them to visit Walton Pavilion in Canton Fair, added the press release.
Brac Bank’s ‘Druti’ clinches 12 awards
Brac Bank's SME (small and medium enterprise) banking solution, Tally Loan 'Druti', has won a slew of awards both locally and globally, consolidating its position in the country's banking sector.
According to Barc Bank, Druti, designed to empower unbanked SMEs in Bangladesh, has secured 12 prestigious awards, a record for a single proposition.
It has achieved the distinguished ‘Product Innovation of the Year Award’ in the platinum category for its Tally Loan 'Druti' at the 2023 Global SME Finance Forum Awards.
This forum, orchestrated by the World Bank Group, acknowledged the Brac Bank for introducing a groundbreaking proposition, integrating unbanked small traders into the conventional banking system.
The coveted award was received by Syed Abdul Momen, Deputy Managing Director and Head of SME Banking, Brac Bank, from Matthew Gamser, CEO, SME Finance Forum, during a ceremony held in Mumbai, India, on September 13, 2023.
In addition, Druti earned considerable recognition at the Bangladesh Brand Forum's Commward, seizing four awards in the following categories: Rural Marketing – Grand Prix, Native - Grand Prix, Campaign for Sustainability – Gold, and Brand Experience and Promotion.
The remarkable SME proposition acquired seven more laurels from the international advertising consortium Mad Stars, renowned for its focus on Marketing, Advertising, and Digital content.
Druti stood out in categories including Brand Experience & Activation Stars, Data Insight Stars-Finance, Data-Driven Targeting, Innovative Use of Technology, Commerce Stars, Sustainable Development Goals-Reduced Inequalities, and PIVOT (Special Category).
Asiatic Communications Limited, the digital agency of BRAC Bank, spearheaded the nominations for Brac Bank in both Commward and Mad Stars and was instrumental in securing these awards.
Syed Abdul Momen said, “Brac Bank has consistently pioneered innovation in banking. Druti Loan transforms the landscape by bringing unbanked micro and small entrepreneurs into the formal banking sector, driving large-scale financial inclusion, and catalyzing national progress.”
“We feel honoured to receive such esteemed awards from the SME Finance Forum of IFC, Bangladesh Brand Forum, and Mad Stars. These accolades are a testament to our unwavering commitment to product innovation aimed at reaching grassroots and unbanked SMEs", he added.
1 USD at Tk 120: Individual traders selling dollars through networks, money changers say they’re empty-handed
Public dependency on the open market for US dollars has increased, where per dollar is being sold at Tk 120-121.
The dollar crisis in the kerb market became more acute after Bangladesh Bank and law enforcers raided money changers with allegations of higher exchange rates.
In this situation, a number of individuals are selling dollars, through their networks, at Tk 120-121 per dollar. They are becoming the lone source of dollars for those who are traveling abroad for treatment, education, and other emergencies, sources said.
Read: Bangladesh Bank introduces dollar booking policy for max 1 year
Jamal (not his real name), owner of a money exchange house in Dhaka’s Motijheel area, told UNB today that they cannot buy a dollar even at Tk 115. “How can we possibly sell per dollar at Tk 113.30?” — he asked.
Many other money changers and individual floating traders of the US dollar remain idle due to the supply crisis of the currency.
In the span of a month, the exchange rate of the US dollar in the kerb (open) market reached Tk 120-121 per dollar from Tk 112. The central bank and law enforcers recently raided money changers and asked to sell per dollar at the previous rate of Tk 113.30.
Read: Selling dollars at higher prices: What is Bangladesh Bank’s action against treasury heads of 10 banks?
Market insiders said there is a severe shortage of US dollars in Bangladesh. The price of foreign currency is increasing uncontrollably and the value of taka is falling. As a result, the price of the dollar in the kerb market has crossed Tk 120.
Talking to various exchange houses and those involved in dollar trading, UNB learnt that most money changers do not have dollars.
Secretary General of the Money Changers Association of Bangladesh, Sheikh Helal Sikder, said that Bangladesh Bank has set the dollar price for money changers. In this case, the buying rate is Tk 111.80 and the selling rate is Tk 113.30.
Read: Dollar goes off kerb market after central bank-led raids of money exchanges
“No one is getting dollars at this price, so the money changers are now sitting empty-handed,” he said.
Replying to a query about the dollar shortage in the kerb market, Bangladesh Bank’s Executive Director and spokesperson, Mesbaul Hoque, told UNB that dollars are being traded, but not everyone is selling them.
Agriculture Ministry opposes plan to import potato
The Ministry of Agriculture gave an opinion opposing the plan of importing potatoes aiming to control price in the domestic market.
As a result, the Ministry of Commerce could not allow businessman to import potatoes.
A senior official of the Department of Agriculture Extension (DAE) told UNB on Saturday on condition of not disclosing his identity that Bangladesh has enough potato in stock to meet the demand of domestic consumers for the next two months or more time, so there is no need to import potatoes.
The official said new potato varieties will be starting to arrive in the market at the end of November.
Read: Efforts are there to curb potato price: Agriculture Minister
Sources at the DAE said that early varieties of potato has been cultivated in some areas of Nilphamari, Thakurgaon, and Panchagarh districts.
The DAE has a preparation to bring early varieties potato from these districts to the market in full swing in the last week of November.
In the case of importing agricultural products into the country, permission need to be taken from the Ministry of Commerce, but permission from the Ministry of Agriculture is required for import of potatoes and some other agricultural products.
Read more: If necessary, potatoes will be imported to tame market, says DG
Bangladesh Bank raises lending interest rate to 10.70% to fight inflation
The Bangladesh Bank (BB) on Thursday increased its lending interest rate on a 50-point basis to tame the growing trend of inflation.
The Banking Regulations and Policy Department (BRPD) of the central bank issued a circular in this regard on Thursday.
The central bank has increased the lending rate of banks by 50 basis points to 10.70 percent from 10.20 percent.
The method based on which the loan interest rate is now being determined is known as 'SMART' or Six Months Moving Average Rate of Treasury Bills. The central bank informs this rate at the beginning of every month.
Md Mezbaul Haque, spokesperson and executive director of the BB, told reporters in this regard that banks can now add 3.50 percent with the reference lending rate, which is also known as the SMART rate of 7.20 percent.
Read: BB raises policy rates by 75 points to 7.5 percent
For pre-shipment export loans, banks can add 2.5 percent with SMART, which was 2.0 percent earlier.
The BB increased the lending rate after increasing the policy rate (repo rate) by 75 basis points to fight inflation.
According to the new guidelines, banks can provide loans in the month of October by adding margin or interest at a maximum rate of 3.5 percent with the 'smart' rate of September.
Read: Don’t print new money, Dr Wahiduddin Mahmud advises BB
In the current month, a maximum of 10.70 percent interest can be taken from banks for large loans. The interest rate on pre-shipment export credit will be 9.70 percent. In case of agricultural and rural loans, the maximum interest can be charged as before—9.20 percent, the circular stated.