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Bangladesh Bank is strengthening its stance on importing non-essential items

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As Bangladesh’s foreign exchange reserves declined, Bangladesh Bank recently instructed banks to prepay up to 75% of corporate import payments to letters of credit (LC) for luxury and non-essential commodities. This decision was made in preparation for future import payment adjustments to the Asian Clearing Union (ACU).

The same margin should be maintained when opening the LC of the sedan and SUV. Importers are required to maintain a 50% margin on opening LCs for non-essential commodities such as clothing and other commodities.

As Bangladesh’s foreign exchange reserves declined, Bangladesh Bank recently instructed banks to prepay up to 75% of corporate import payments to letters of credit (LC) for luxury and non-essential commodities. This decision was made in preparation for future import payment adjustments to the Asian Clearing Union (ACU).

According to Bangla media reports, the payment is estimated to consume $ 2.24 billion in the country’s foreign exchange reserves.

ACU is an arrangement for participating countries to settle import payments for intra-regional transactions. Bangladesh, Bhutan, India, Iran, Maldives, Myanmar, Nepal, Pakistan and Sri Lanka are members of the Tehran-based ACU founded in 1974.

On April 11, banks were instructed to impose a margin of at least 25% on opening LCs for non-essential consumer goods. However, this could not curb the increase in import payments.

The central bank of the previous circulation did not portray the item facing the margin. But this time, I’ve mentioned some extravagant and non-essential items that will face high margins.

However, the central bank did not impose margins on essentials such as baby food, fuel oil, life-saving medicine, and products for farms, exports, and the local industrial sector. For these items, banks can maintain margins based on their relationships with their customers.

Last year, when imports plummeted during a coronavirus pandemic, the central bank bought a record $ 7.93 billion from a local bank. As a result, foreign exchange reserves exceeded $ 48 billion in August last year.

Fiber2Fashion News Desk (DS)



Bangladesh Bank is strengthening its stance on importing non-essential items

Source link Bangladesh Bank is strengthening its stance on importing non-essential items

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