The Dhaka Chamber of Commerce and Industry (DCCI)
has lauded the central bank’s decision for LC margin withdrawal stating that
it would stimulate trade and investment in the country.
Recently, Bangladesh Bank through a circular took a decision of lifting the
LC margin on all types of imports except for some luxury products
manufactured in Bangladesh with a view to largely alleviate the recent
stagnation caused at the product import level and speed up industrialization.
In addition, the Dhaka Chamber expects that the initiative of forming a
‘Revolving Refinancing Fund’ by the central bank with the aim of expanding
the financial services for the development of cottage, micro, small and
medium enterprises (CMSME) in the country will make financing of
entrepreneurs in this sector easier, said a press release.
The DCCI applauded the central bank for taking such initiative in the
prevailing situation of the financial sector and economy.
As per the directives of the central bank, from now on importers
can import
all types of capital equipment, consumer goods and capital raw materials
without any margin on the basis of bank-customer relationship.
Moreover, if imports increase; new investment, re-investment, availability of
capital equipment and overall industrial production will subsequently
increase, that would bring a positive result in export growth, said DCCI
President Ashraf Ahmed.
Along with this, the supply of raw materials to the industries will also
increase; as a result, factories will be able to ensure full-fledged
production at their highest capacity, he added.
Supply of products in the market will accordingly increase as well as it may
have a positive impact on the overall inflation situation of the country.
On the other hand, while the country is experiencing the ongoing liquidity
crisis in the financial sector, especially difficulties in obtaining easy
lending by the CMSMEs and lower credit flow to the private sector; at that
time such an initiative of a ‘Revolving Refinancing
Fund’ by the central bank
would play a pivotal role in getting refinancing benefits for the small
entrepreneurs.
The Dhaka Chamber also believed that this fund will be useful for the growth
of production of goods and services, income and employment generation of the
CMSME sector.
This fund will also help the affected small entrepreneurs in meeting their
need of working capital to turn around.
Especially for CMSMEs, in case of refinancing under this fund, the interest
rate will never exceed 8 percent and in this case no supervision charge or
even early settlement fee can be imposed, which would be a relief for CMSMEs.
The DCCI also believed that the CMSME sector is the main driving force of the
country’s economy.
If the CMSME sector is given special advantage in the development of backward
linkage industry and employment generation, its positive impacts will no
doubt be reflected in the overall economy, added the press release.
Source: Bangladesh Sangbad Sangstha
