Important Business News Extracts – October 18, 2017
Deliver remittance fast at lowest charge: BB
Bangladesh Bank has instructed banks to disburse remittance among beneficiaries within the quickest possible time and charge the minimum in order to increase the inflow. Banks should apply agent banking and mobile financial services to send out remittances among near and dear ones of expatriate Bangladeshis, BB Deputy Governor SK Sur Chowdhury said yesterday. He was addressing a meeting with managing directors of the top 20 remittance earning banks at the central bank headquarters in the capital. From now on, all migrant workers have to open a bank account before leaving the country and the banks should extend their cooperation to the workers to this effect, he said. The Ministry of Expatriates’ Welfare and Overseas Employment on August 24 issued a directive saying all migrant workers would have to open bank accounts. Chowdhury asked the banks to use digital payment systems to bring in remittance from abroad to encourage both remitters and beneficiaries.
Inflation accelerated for the second consecutive month in September thanks to the rise in food prices backed by the staple rice. Last month, inflation stood at 6.12 percent, up 23 basis points from August, according to data from the Bangladesh Bureau of Statistics. Planning Minister AHM Mustafa Kamal yesterday released the inflation data of the last two months but did not give a breakdown of food and non-food inflation — both of which were departures from previous practice. On May 16, Kamal had announced that the government will make public the Consumer Price Index data on a quarterly basis instead of the global standard practice of monthly reporting — a move that gave rise to an air of suspense surrounding the release of inflation statistics. True to his word, his next release of inflation data, which came in July, was on a quarterly basis — for the April-June quarter — but he went back to monthly reporting the following month, disclosing the figure for July. Inflation declined for the first time in eight months in July: it stood at 5.57 percent, 0.3 percentage point lower than the previous month.
Garment accessories makers and exporters yesterday demanded cash incentives on export, reduction of corporate taxes and smooth functioning of the country’s premier port in Chittagong. The demands came at a seminar on “$50 billion RMG export by 2021: Role and Challenges of Garments Accessories and Packaging Sector” organised by the Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) at the Cirdap auditorium in Dhaka. Abdul Kader Khan, president of BGAPMEA, chaired the seminar and its former president Rafez Alam Chowdhury gave a keynote presentation. Chowdhury said the backward linkage industry met demands for accessories and packaging of nearly 95 percent of export-oriented industries, including the garment and pharmaceutical sector. The accessories sector earned $6.7 billion through “deemed exports” while it also made direct exports worth $1.12 billion in the last fiscal year. The accessories sector never gets any cash incentive against the export earnings as given to other sectors that help those flourish, Chowdhury said.
United Commercial Bank (UCB) yesterday launched a digital banking platform—Upay—for its clients. AE Abdul Muhaimen, managing director of the bank, announced the launch of the payment platform at a programme at the Westin Dhaka hotel. For the first time in the country Upay will use the advanced technologies like Blockchain and QR Code to ensure secure financial transactions, Muhaimen told reporters. The platform will help the bank’s retail and corporate clients access their accounts and perform all banking transactions, according to the bank. Upay has introduced the service aiming to promote cashless and universal banking meaning anytime-anywhere payments using mobile phones in Bangladesh. The platform will cater to all consumers, corporate and government payments like merchant shopping, bill payment, fund transfer, loan repayment, inward remittance, insurance premium, salary disbursement, and e-commerce.
IDLC Finance’s net profit rose 35 percent year-on-year to nearly Tk 181 crore in the first nine months of 2017. The company’s earnings per share also increased 18 percent to Tk 4.90 during the period, the largest non-banking financial institution said at a press conference yesterday. In the nine months, IDLC acquired 8,563 new customers and grew the customer assets portfolio by 13 percent or Tk 834.1 crore to end the quarter with a loan book of Tk 7,061 crore. The growth in customer assets was driven primarily by the SME loans, which experienced a healthy 20 percent growth in the period, according to the statement. The company’s SME loans currently stand at Tk 3,131 crore, which is 46 percent of its total loan book. Its consumer loans also grew 11 percent in the corresponding period to stand at Tk 2,380 crore, IDLC said. The company’s non-performing loan ratio stood at 2.83 percent as of September 30, 2017 compared to 2.98 percent in December 31, 2016.
The revenue board found its online system for submission of income-tax returns largely forlorn and went on a mass campaign for teaching taxpayers how to do it. Sources said less than 100 taxpayers so far obtained user-identification number and passwords from the National Board of Revenue (NBR) for online submission of tax returns in the current fiscal year. The Large Taxpayers Unit (LTU) has selected 20 top corporate taxpayers to encourage and motivate them for filing income-tax returns online by using the donor-aided system in operation since November 01, 2016. So far, only two out of 300 large corporate taxpayers have sought passwords from the taxmen for online filing of returns. The board has also launched motivational campaigns for the individual taxpayers ahead of the deadline for tax-return submission — November 30, 2017.
Scarce facilities at land ports hamper bilateral trade: study
Inadequate facilities at the Benapole and Petrapole land ports hamper bilateral trade between Bangladesh and India, found a survey conducted by the South Asian Network on Economic Modelling (Sanem), a private think tank. Some 37 percent of the respondents found the business operation hours at Benapole to be unsatisfactory, 20 percent adequate and 43 percent very poor. The effective working hours in practice are from 10am to 2pm, meaning that instead of the eight hours of a working day, this port was effective for only four hours a day, says the survey. Among respondents at Petrapole, 36 percent found business operation hours at the Indian port to be unsatisfactory, 18 percent adequate and 46 percent very poor. The situation is more or less the same in other areas, such as infrastructure, regulatory and administrative procedure, facilities and use of digital and advanced technology, capacity of the workforce, social and local conditions and basic utilities, including electricity and water. Sanem disclosed the findings at a press conference at its office in Gulshan yesterday.
Income inequality in Bangladesh has widened further despite decline in the rate of poverty, dropping to 24.3 per cent last year from 31.5 per cent six years back. Official findings in the Household Income and Expenditure Survey (HIES) 2016 unveiled Tuesday such a state of poverty, hunger and income of people in the country. The survey, conducted by the state-run Bangladesh Bureau of Statistics (BBS), showed that the Gini coefficient, which measures income inequality within a country’s population, increased to 0.483 from 0.458 in 2010. According to the HIES 2016, the income inequality in the urban areas has risen faster than in the rural areas.
Petrobangla, local co sign term sheet on LNG terminal
State-owned Petrobangla on Tuesday signed a term sheet for LNG Terminal Use Agreement with local company Hong Kong Shanghai Manjala Power Limited (HSMPL) and its foreign partners, reports UNB. As per the contract, HSMPL and its consortium partners Global LNG and Petronas LNG Limited of Malaysia will set up 500 mmcfd capacity LNG terminal with FSU and Fixed Jetty Based Re-gasification Unit at Kutubdia of Cox’s Bazar. Petrobangla officials said this is the third agreement for setting up LNG terminal with storage and re-gasification facilities in the private sector. Earlier, the Petrobangla signed similar agreements with US-based Excelarate Energy and local Summit Group to set up similar capacity terminal. The government has planned to import LNG and supply it to local consumers through re-gasification at these terminals.
Latifur Rahman wins lifetime achievement award from UKBCCI
Latifur Rahman, chairman and CEO of Transcom Group, has been honoured with the UKBCCI Lifetime Achievement Award for his outstanding contribution to the economy and the society. UK Bangladesh Catalysts of Commerce and Industry (UKBCCI) conferred the honour on the veteran Bangladeshi businessman at the UKBCCI Business and Entrepreneur Excellence Awards-2017. The event took place at the London Hilton on Park Lane on October 15, UKBCCI said in a statement yesterday. “As a Bangladeshi, I feel proud looking at the success of my fellow countrymen in the UK,” the overwhelmed Latifur Rahman said after receiving the award. He cited Bangladesh as a foreign investment-friendly country and called upon the young entrepreneurs of Britain to engage in deeper collaboration with the Bangladeshi business community.
A long pending project of Bangladesh Telecommunications Company Ltd to upgrade and modernise its countrywide network finally got the nod yesterday but with the condition that its cost has to be slashed by about Tk 700 crore. The Executive Committee of the National Economic Council also formed a committee, headed by Telecom Secretary Shyam Sunder Sikder, to bargain with the supplier to bring down the price from the estimate of Tk 2,573.40 crore, Planning Minister AHM Mustafa Kamal told reporters after the meeting. Of the amount, the government would provide Tk 756.12 crore from the national exchequer and the remaining Tk 1,817.28 crore would come as project assistance from China.
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