Business
Trade through Benapole land port resumes after 2 days
Export-import activities between Bangladesh and India through Benapole land port resumed on Monday after two days of suspension following a strike called by several port users’ organizations.
The protesters withdrew their indefinite strike, which was enforced on Saturday, after a fruitful meeting with the customs authorities.
The workers of five port users’ organisations joined their work around 9 am on Monday.
Read: 2 killed in separate city road accidents
On March 2, customs officials seized huge Indian contraband goods including phensidyl, explosives, cigarette, current nets, and cloths worth Tk 50 lakh from two Indian trucks.
They also suspended the liscenses of two organizations including Shimul Trading Agency and IDS Group. A complaint was lodged with Benapole port in this connection.
Protesting the customs officials’ move, five port users’ organisations went on an indefinite strike from Saturday and threatened to continue it until restoration of licenses of two C&F agents.
Enamul Haque Lata, general secretary of Benapole C&F Agent Association, said the customs authorities assured us of meeting our demands within one week.
Brent crude up $10, shares sink as Ukraine conflict deepens
The price of oil jumped more than $10 a barrel and shares were sharply lower Monday as the conflict in Ukraine deepened amid mounting calls for harsher sanctions against Russia.
Brent crude oil surged over $10 early Monday. Benchmark U.S. crude was up nearly $9 at more than $124 a barrel.
The surge followed a warning from Russian President Vladimir Putin that Ukrainian statehood was imperiled as Russian forces battered strategic locations. A temporary cease-fire in two Ukrainian cities failed over the weekend — and both sides blamed each other.
Oil prices came under additional pressure after Libya’s national oil company said an armed group had shut down two crucial oil fields. The move caused the country’s daily oil output to drop by 330,000.
U.S. House of Representatives Speaker Nancy Pelosi, meanwhile, said the House was exploring legislation to further isolate Russia from the global economy, including banning the import of its oil and energy products into the U.S.
By late morning in Tokyo, U.S. crude had jumped $9.08 to $124.74 a barrel in electronic trading on the New York Mercantile Exchange. The all-time high was marked in July 2008, when the price per barrel of U.S. crude climbed to $145.29.
That pushed the average price for gasoline in the U.S. above $4 a gallon, a milestone already reached again. The price of regular gasoline rose almost 41 cents, breaking $4 per gallon (3.8 liters) on average across the U.S. on Sunday for the first time since 2008, according to the AAA motor club.
Read: Asian stocks rebound after Wall St falls on Ukraine tensions
The all-time high for average gasoline prices was set in July 17, 2008 at $4.10 per gallon.
Brent crude, the international pricing standard, hit $139.13 per barrel before falling back Monday. It was trading up $10.56 at $128.67 a barrel.
On Wall Street, U.S. futures fell, with the contract for the benchmark S&P 500 down 1.6% and that for the Dow industrials falling 1.3%. Stock futures in Europe also declined.
Higher fuel costs are devastating for Japan, which imports almost all its energy. Japan’s benchmark Nikkei 225 dipped 3.5% in morning trading to 25,091.93.
Hong Kong’s Hang Seng dropped 4.0% to 21,021.38, while South Korea’s Kospi dived 2.5% to 2,648.48. Australia’s S&P/ASX 200 shed 1.2% to 7,023.10. while the Shanghai Composite lost nearly 0.8% to 3,421.81.
“The Ukraine-Russia conflict will continue to dominate market sentiments and no signs of conflict resolution thus far may likely put a cap on risk sentiments into the new week,” said Yeap Jun Rong, market strategist at IG in Singapore.
“It should be clear by now that economic sanctions will not deter any aggression from the Russians, but will serve more as a punitive measure at the expense of implication on global economic growth. Elevated oil prices may pose a threat to firms’ margins and consumer spending outlook.”
Markets worldwide have swung wildly recently on worries about how high prices for oil, wheat and other commodities produced in the region will go because of Russia’s invasion, inflaming the world’s already high inflation.
Russian forces intensified shelling of cities in Ukraine’s center, north and south, according to a Ukrainian official, as a second attempt to evacuate civilians collapsed. Russia has made significant advances in southern Ukraine and along the coast, although many of its efforts have stalled, including an immense military convoy north of Kyiv.
Read: Netflix, TikTok block services in Russia to avoid crackdown
Companies have been exiting Russia, including Mastercard and Visa, as well as Netflix. The conflict in Ukraine also threatens the food supply in some regions, including Europe, Africa and Asia, which rely on the vast, fertile farmlands of the Black Sea region, known as the “breadbasket of the world.”
Wall Street finished last week with shares falling despite a much stronger report on U.S. jobs than economists expected. The S&P 500 fell 0.8% to 4,328.87, posting its third weekly loss in the last four. It is now down just under 10% from its record set early this year.
The Dow, initially fell more than 500 points. It closed 0.5% lower at 33,614.80. The Nasdaq fell 1.7% to 13,313.44. The Russell 2000 index of small companies dropped 1.6% to 2,000.90.
In currency trading, the U.S. dollar edged up to 114.93 Japanese yen from 114.86 yen. The euro cost $1.0846, down from $1.0926.
Environment-friendly ‘Sonali Bag’ headed to dustbin of history
Environment-friendly Sonali Bag, made of jute, has not been commercially viable even after five years of its pilot production due to fund shortage and continuing promotion of harmful polythene bags. Project insiders and innovators of the product are frustrated after failing to attain commercial viability even as an environmentally friendly alternative to polythene. The project is waiting to die now due to lack of allocation to run the factory, project insiders said. A pilot project was taken up in 2018 to market bags made from jute. However, the bag could not be brought to the market commercially in his fifth year. Inventor Mubarak Ahmed says another Tk 350-400 crore would be needed to market the golden bag.
Read: Hasina seeks Russian investment in jute sector
Only limited production of bags has been possible The officials of Bangladesh Jute Mills Corporation could not say when the project of commercial production of golden bag, an alternative of polybag will be implemented. In the absence of reliable alternatives, the market has floated banned polythene. The use of polythene is increasing in vegetable markets, grocery stores, shopping malls, and chain shops. Occasional raids have been carried out to control these environmentally harmful products, but the use of polythene has not reduced due to lack of alternatives. Polythene was banned in Bangladesh in 2002. Environmentalists say the failure to enforce the law is not the reason for the release of polythene. Not only Bangladesh, but the whole world is also worried about polythene. Millions of tons of polybags are being used every day, polluting the environment.
Read: Saudi willing to invest in closed jute mills Mubarak Ahmed Khan, Scientific Adviser of Bangladesh Jute Mills Corporation (BJMC), was the inventor of eco-friendly bags from jute named Sonali Bag in 2016.
It is a cellulose-based biodegradable bioplastic, an alternative to plastic bags. This bag is made by collecting cellulose from jute. It looks like ordinary polythene, but it is perishable. Before coming to the market commercially, ‘Sonali Bag’ had received a positive response at home and abroad. A pilot project was taken up in 2016 to market the bag. However, the bag could not be brought to the market commercially in six years.
Read Production in BJMC’s 2 leased out jute mills begins State owned Latif Bawani Jute Mill on the west bank of Shitalakshya River in Demra, Dhaka houses a factory for making Sonali Bags. On April 7, 2019, Tk 10 crore was allocated from Bangladesh Climate Trust Fund for the production of this bag. Necessary equipment and chemicals were purchased with that money. The bag is sold from the BJMC office at Motijheel only. In this context Bangladesh observed Jute Day-2022 on Sunday (March 6) with the theme of ‘Golden country of golden fire, environment friendly Bangladesh’.
Read BTMC’s jute mills incurred loss of Tk 3,168 cr in FY 21: Jute Minister
VAT compliance, widening tax net must for easing tax burden: NBR Chairman
Chairman of National Board of Revenue (NBR) Abu Hena Md Rahmatul Muneem said compliance of corporations is essential for better operations of businesses and VAT collection.
He also called for widening tax net for easing burden on a limited number of tax payers.
The government has taken initiative to bring the entire VAT system under automation to prevent VAT evasion and ensure greater transparency and accountability, he said.
He was addressing the closing ceremony of a two-day workshop on VAT Compliances: Role of CMAs' held at ICMAB Ruhul Quddus Auditorium last (Saturday) night.
Also read: NBR goes all-out to boost tax revenue for better economic growth
FBCCI president Md Jashim Uddin said at the event the government pay attention to businesses so that they can cooperate with the tax collectors.
The workshop was organized by Institute of Cost and Management Accountants of Bangladesh (ICMAB), a concern, ministry of commerce.
Speakers in the workshop said an effective VAT audit system based on integrated audited accounts can play a vital role as a catalyst to the taxman.
A comprehensive reform of the value-added tax (VAT) regime and automation can facilitate it for both taxpayers and businesses, they said.
ICMAB president Md Mamunur Rashid, and seminar and conference committee chairman AKM Delwer Hussain, among others, spoke there.
ICMAB council member and past president Abu Sayed Md Shaykhul Islam presented a theme paper of the event.
ICMAB President said that CMA professionals can create a great impact by putting their expertise to ensure clarity in various economic aspects.
He requested to create more scope for the CMA professionals in relevant fields so that they can give their effort for the development of this country.
Also read: ICMAB wants VAT system reform to make it business friendly
He emphasized adding the Cost of Goods Sold statement with company return after getting certification from Cost and Management Accountants. As a result the revenue of the NBR will be increased.
He mentioned that Bangladesh is now an emerging country to invest in South Asia. In that case, the VAT law and regulations should be business friendly.
Three technical papers were presented at the workshop. ICMAB treasurer Md Ali Haider Chowdhury and Mallik Intaqab Ahsan presented a paper on 'VAT and VAT Accounting' in the first technical session. Faruque Sikder presented a paper on 'VAT and Accounts Automation' while customs additional commissioner Kazi Muhammad Ziauddin on 'VAT Reforms' in the second and third technical sessions respectively.
Dr. Md. Hamid Ullah Bhuiyan, Chairman, Financial Reporting Council (FRC); Syed Musfequr Rahman, Commissioner, Customs, Excise and VAT, NBR; Dr. Md. Abdur Rouf, DG, Customs Intelligence and Investigation, National Board of Revenue chaired different sessions.
Md. Mashiur Rahaman ACMA, Joint Commissioner, NBR; Mr. Fahmid Wasik Ali FCMA, Md. Shafiqul Alam FCMA attended the technical sessions.
Brand Bangladesh in a new way, FBCCI president urges entrepreneurs
FBCCI President Md. Jashim Uddin on Saturday called upon the entrepreneurs of garments and textile industries to diversify their investments and brand Bangladesh in a new way.
The president made the call at the first meeting of the standing committee on RMG, knitwear and sweaters at the FBCCI office.
He said that most entrepreneurs are interested in investing in cotton-based garment and spinning sector.
“However, now the demand for manmade fiber clothing is increasing in the world market, and the price is also higher,” he said.
The President urged the entrepreneurs in the readymade garments and textile sectors to invest in the man-made fiber sector.
Read: Strict monitoring to check price hike of commodities during Ramadan: Munshi
He mentioned that exporters are gradually losing the advantage of cheap power, energy and labour.
Despite being the second largest exporter of readymade garments, he said, Bangladesh mainly exports relatively cheap garments.
Jashim Uddin said that the prices of raw materials are constantly rising. Therefore, in order to continue to growth of the industry, exporters must now focus on exporting high value garments, he said.
Speaking as the chief guest at the meeting, the president said a safety council has been set up at the FBCCI to ensure the safety of non-export-oriented factories.
The Safety Council is working with BIDA to secure all the industries in the country, he added.
Faruque Hassan, chairman of the committee and president of BGMEA, said a study is going on to explore the new items which the producers might be good at, and also to identify the new opportunities to expand their investments.
“Exporters are often reducing the prices of their products by competing with each other,” he said.
The BGMEA president called for an end to the competition.
Meanwhile, BKMEA executive president Mohammad Hatem proposed to form different sub-committees on the banking and financial sector, power and energy, finance ministry and labor ministry to solve problems of the garment industry.
Read: Remittance inflow down by $ 3.25 billion in 8 months of FY 22
The members of the committee present at the meeting said that harassment of the Customs and Bond Commissionerate is now the biggest problem for them.
Businessmen are also facing hurdles in importing various raw materials due to HS code complications.
Entrepreneurs also think that the law needs to be amended for wastage recycling.
FBCCI Director and Director-in-Charge of the Standing Committee on Land Ports, Bijoy Kumar Kejriwal said the committee would do its utmost to help resolve any issues regarding land port.
FBCCI Director Harun Or Rashid, Secretary General Mohammad Mahfuzul Hoque, Standing Committee Co-Chairman Abdullah-al-Mahmud Mahin, Enthekhabul Hamid Apu, Shams Mahmud, Fazle Shamim Ehsan, Mohammed Kamal Uddin, Anjan Shekhar Das, Humayun Kabir Selim were also present among others.
IBBL Dhaka North Zone, South Zone hold business development conference
Dhaka North and Dhaka South Zone of Islami Bank Bangladesh Limited (IBBL) organised a business development conference in the capital Wednesday.
Mohammed Monirul Moula, managing director and CEO of the bank, addressed the conference virtually as the chief guest.
Md Omar Faruk Khan, additional managing director, spoke as a special guest.
Read IBBL relocates its Rampura Branch
IBBL deputy managing directors Md Mostafizur Rahman Siddiquee and Md Altaf Hossain; senior executive vice-presidents Mohammed Shabbir and Md Maksudur Rahman; executive vice-presidents ASM Rezaul Karim and Md Mizanur Rahman Bhuiyan, also addressed the programme.
Muhammad Saeed Ullah, head of Dhaka North Zone, presided over the function; Mir Rahmat Ullah, head of Dhaka South Zone, delivered the welcome speech.
Read IBBL Khulna holds agent banking conference
Inflation rate is double than the BBS data, says SANEM in a report
The South Asian Network on Economic Modeling (SANEM) has claimed that the overall inflation rate in the country is more than double from the calculation provided by Bangladesh Bureau of Statistics (BBS).
The SANEM claimed that the overall inflation rate in urban areas is now 12.47 per cent, which is 12.10 per cent in rural areas in Bangladesh.
However, the report released by BBS on February 16 said that in the first month of January this year, the inflation rate in the country was 5.86 per cent.
The rate was above 6 per cent to 6.5 per cent in December last, which was 5.98 per cent in November.
Read: Speakers in webinar urge to promote EV business in Bangladesh
Economists have earlier expressed doubt about the credibility of the BBS figures regarding inflation in the wake of the upward trend of commodities prices. This time in a study of SANEM found more information that shows the weakness of BBS reports.
The SANEM released an online report on Thursday entitled "Inflation: Government Statistics vs. the Reality of Marginal People".
Selim Raihan, executive director of SANEM, said the BBS provides information on inflation rate that does not reflect reality of economics, if the correct information is not brought out, the recovery process will not be sustainable.
IBBL Dhaka North Zone, South Zone hold agent banking conference
Dhaka North and Dhaka South Zone of Islami Bank Bangladesh Limited (IBBL) organised the "Agent Banking Business Development Conference" and "Workshop on Prevention of Money Laundering and Terrorist Financing" in the capital Wednesday.
Md Omar Faruk Khan, additional managing director of the bank, addressed the conference as chief guest.
JQM Habibullah, deputy managing director of IBBL, addressed it as a special guest.
Read: Pandemic impact: Banks’ bad loans rise by 8 per cent to Tk 1.3 trillion
Md Maksudur Rahman, senior executive vice-president, presided over the function. ASM Rezaul Karim, executive vice-president, delivered the welcome speech.
Taher Ahmed Chowdhury, chief anti-money laundering compliance officer; senior executive vice presidents Md Jamal Uddin Majumder and Md Mahboob Alam, Muhammad Saeed Ullah, head of Dhaka North Zone, Md Shamsuddoha, executive vice-president, and Mir Rahmat Ullah, head of Dhaka South Zone, also spoke.
Read IBBL, JPMorgan Chase Bank hold meeting
Asian stocks rise after Fed chair supports smaller rate hike
Asian stock markets rebounded Thursday and oil prices climbed higher after the head of the Federal Reserve said he supports a smaller rise in interest rates than some expected.
Shanghai, Tokyo, Hong Kong and Sydney advanced even as Russian forces whose attack on Ukraine has roiled financial markets bombarded the country's second-largest city and besieged two ports.
Wall Street's benchmark S&P 500 index rose 1.9% on Wednesday, recovering this week's losses after Fed Chair Jerome Powell said the U.S. central bank is set to raise its key interest rate for the first time since 2018. He said he supports a traditional rate hike of 0.25 percentage points instead of the bigger rise recommended by some policymakers.
Read: Ruble dives, stocks sink as West tightens Russia sanctions
Powell said the impact on the U.S. economy of Russia's attack is “highly uncertain.”
“Markets have reacted positively to the remarks, which is a debatable interpretation of Powell’s nuanced comments,” ING economists said in a report. “Volatility is the key here, and uncertainty. This isn’t going to go away any time soon.”
The Nikkei 225 in Tokyo rose 0.8% to 26,608.21 and the Hang Seng in Hong Kong gained 0.6% to 22,469.66. The Shanghai Composite Index advanced 0.1% to 3,487.78.
The Kospi in Seoul added 1.6% to 2,745.45 and Sydney's S&P-ASX 200 was 0.8% higher at 7,171.10. New Zealand and Southeast Asian markets also advanced.
Share prices have swung widely as investors try to figure out how the Russian attack will affect supplies of oil, wheat and other commodities and the global recovery from the coronavirus pandemic.
Traders already were uneasy about plans by the Fed and other central banks to fight inflation by withdrawing ultra-low interest rates that boosted stock markets.
The S&P 500 rose to 4,386.54. The Dow Jones Industrial Average gained 1.8% to 33,891.35. The Nasdaq composite advanced 1.6% to 13,752.02.
More than 90% of stocks in the S&P 500 rose. Tech, finance and health care companies accounted for a big share of the rally. Energy stocks also helped lift the index as they rode higher oil prices.
Ford Motor Co. jumped 8.4% after it said it was accelerating its transformation into an electric-vehicle company and separated its EV and internal combustion operations.
The yield on the 10-year Treasury bond, or the difference between its market price and the payout at maturity, rose to 1.89% from Tuesday's 1.72%. However, yields still were below where they were before Russia's invasion.
In energy markets, benchmark U.S. crude rose another $2.68 to $113.28 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the price basis for international oils, added $3.61 to $116.54 per barrel in London.
Both gains were smaller than Wednesday's surge of more than $7 per barrel but still unusually wide margins for a daily change.
Leaders of OPEC and other major oil exporters decided Wednesday to stick to plans to gradually increase production. The coalition, made up of OPEC members led by Saudi Arabia and non-cartel members led by Russia, chose to increase production by 400,000 barrels per day in April.
Read:Stocks slump, oil surges over Ukraine conflict
Also this week, the United States and other major oil consumers in the International Energy Agency agreed to release 60 million barrels from strategic reserves to boost supplies. But that has had little impact on market prices.
In currency markets, Russia's ruble gained 3.4% against the U.S. dollar but still was near a record low value of less than 1 cent. It has fallen nearly 25% since the attack after Western governments imposed sanctions that cut off much of Russia's access to the global financial system.
The dollar gained to 115.63 yen from Wednesday's 115.58 yen. The euro declined to $1.1097 from $1.1126.
Pandemic impact: Banks’ bad loans rise by 8 per cent to Tk 1.3 trillion
The Covid-19 pandemic pushed up default bank loans to 8 per cent to Tk1.3 trillion ( 1 trillion is equal to Tk 1 lakh crore) in last December.
Bangladesh Bank (BB) failed to curb the loans default despite providing a number of facilities including moratorium (a loan moratorium is a legally authorized period that delays the payment of money due on account of specific loan instalments) of instalment payments.
According to BB’s latest data, the default loans amount stood in December 2021 at over Tk1.3 trillion (8 per cent of total loans), that was Tk 88734 crore (7.66 per cent) in December 2020.
Read: BB asks NBFIs comply with Banker's Book Evidence Act-2021 to avoid imprisonment
According to the latest data from the central bank, at the end of December last year, the total debt of the banking sector stood at Tk13.18 trillion.
At the end of September, the total debt balance was Tk12. 45 trillion. Of this, the defaulted loans shot to Tk1.15 trillion, which was 8.12 per cent of the total debt.
Till June last year, the total amount of loans disbursed in the banking sector was Tk12.13 trillion. The defaulted loans stood at Tk 99205 crore. In the three months from March to June, defaulted loans increased by Tk 3,899 crore, the BB sources said.
Read: Economy resilient, no liquidity shortages in banks: BB governor
Of the new defaulted loans, more than Tk 11,000 crore has been raised in private banks and more than Tk 2,000 crore in state owned banks. Due to this increase, the private banks overtook the unrealised loans in the government banks.
However, the default rate in the state banks is more than three times that of private banks. About 20 per cent of the loans disbursed in the state-owned banks have been defaulted.
Even if it increases a lot in one year, the default rate among the disbursed loans is a little more than 5 per cent.
Read Remittance to exceed $25 billion by end of current fiscal : Finance Minister
Although the situation of public, private and foreign banks has deteriorated in the last one year, the situation of three specialized banks has improved. These banks have been able to reduce defaulted loans.