Important Business News Extracts – July 31, 2017

Imports to be costlier

The gap between buying and selling rates for US dollar has recently widened to Tk 1.50 from Tk 1, in a development that has made imports costlier and can go on to create inflationary pressure and squeeze the foreign exchange reserves. For years, the gap has been Tk 1 a dollar as per the instruction of the central bank, according to data from the Bangladesh Bank and Bangladesh Foreign Exchange Dealers’ Association.“Basically, it’s a supply-demand conundrum,” said Anis A Khan, managing director of Mutual Trust Bank and a former chairman of BAFEDA, about the widening gap. Exports and inward remittances, the two major sources of foreign currency in Bangladesh, are on the wane while imports are rising, widening the current account deficit.“All these factors have led to the increase in demand for the greenback and the rising gap between the selling and buying prices,” he said. Remittance inflow in fiscal 2016-17, of $12.77 billion, was the lowest in six years. And for the first time in 15 years, Bangladesh’s apparel exports failed to register even single digit growth. The apparel export growth last fiscal year was just 0.20 percent. In contrast, in the last 10 years growth averaged about 13 percent.

Source:   http://www.thedailystar.net/business/imports-be-costlier-1441222

Export target $37.5b

The export target for fiscal 2017-18 has been set at $37.5 billion — 8.23 percent higher than last fiscal year’s receipts.Bangladesh exported goods worth $34.65 billion last fiscal year, up 1.61 percent year-on-year, according to data from the Export Promotion Bureau.The garment sector would be gunning for a $30.16 billion export target, 7.19 percent higher than fiscal 2016-17’s receipts.The current economic outlook, policy changes in different export destinations, the trade report of the World Trade Organisation, exporters’ feedback, exchange rate movement and supply side capacity were considered during the setting of the export target, Commerce Minister Tofail Ahmed said while disclosing the figure yesterday.Bangladesh could not achieve the export target last fiscal year because of the devaluation of the Euro and pound sterling against the US dollar, the minister said.Brexit, national elections in major export destinations in the EU, and the lower prices of goods, especially garment, were also responsible for missing the target last fiscal year.

Source:  http://www.thedailystar.net/business/export-target-375b-1441216

Ctg port’s incompetency raising cost of doing business

Country’s businesses on Saturday said that incompetency of the Chittagong port was increasing the doing business cost and no steps were taken to reduce time and cost at the port though a lot of discussion were taken place on the issue. At a roundtable ‘Chittagong Port: Current Status and Way Forward’ organised by the Dhaka Chamber of Commerce and Industry at the Lakeshore Hotel in Dhaka, businesses said that to achieve a sustainable economic development the governance at the port should be improved significantly. ‘Operations at the Chittagong port have become handicapped. Eid holidays and natural disasters also affect the port performance. An alternative mechanism is needed to address the problem,’ International Chamber of Commerce president Mahbubur Rahman said. He emphasised development of waterways from the Chittagong port to Pangaon and to divert minimum 50 per cent of road container traffic to waterways .Requesting the government to engage the private sector in the port operation, Mahbubur said that a port development plan should have to be developed and implemented before 20 years.Abul Kasem Khan, president of the DCCI, said that despite an improved ranking globally, the port faced manifold challenges and problems, resulting in serious efficiency issues that downgraded the business competitiveness of Bangladesh.

Source: http://www.newagebd.net/article/20823/ctg-ports-incompetency-raising-cost-of-doing-business

Mercantile Bank focuses on SMEs

Mercantile Bank has shifted its focus on retail and SME banking instead of corporate lending, CEO Kazi Masihur Rahman said yesterday.“We won’t waste our time running after big clients. I have asked our officials to look for SME (small and medium enterprises) and retail customers,” he told journalists while disclosing the bank’s half-yearly earnings at a programme at its headquarters in the capital.As part of the move, he said the bank has segregated its branches based on corporate, SME and retail banking. It aims to disburse Tk 3,200 crore in loans to SMEs this year, up 60 percent year-on-year, he said.Established in 1999, Mercantile Bank earned more than Tk 500 crore in operating profit for the first time last year. It went up to Tk 325 crore in this year’s first half, up 42 percent from the same period a year ago.“now sky is the limit for us,” said Rahman. He said they were investing a huge amount of money on their IT wing to ensure security of customers. But, he declined to disclose the figure.

Source:  http://www.thedailystar.net/business/mercantile-bank-focuses-smes-1440901

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