Growth of International Trade and Its Financing in Bangladesh Assignment

Growth of International Trade and Its Financing in Bangladesh Assignment Words: 9864

Letter of Transmittal January 2008 The Director Center for Post Graduate Studies (CPGS) Bangladesh Institution of Bank Management, Mirpur-2, Dhaka. Subject: Submission of the dissertation paper on “Growth of International Trade & its financing in Bangladesh”. Dear Sir, With due respect I would like to draw your kind attention to the fact that preparing a dissertation paper & submitting it to the MBM office is an academic requirement for the partial fulfillment of the 6th Term MBM Program. I have tried hard in preparing this dissertation and tried to make the report vivid and comprehensive within the constraints.

I sincerely believe that it will serve the required purposes. I shall always be obliged to furnish any clarification regarding this dissertation, if required. Sincerely Yours, ————————– (Mukti Chakraborty) MBM 10th Batch Roll No. : 100616 BIBM Acknowledgement At the beginning, I would like to express my sincere gratitude to the God most merciful and beneficiary for empowering me conduct the report within scheduled time. I would like to express my profound gratitude and wholehearted respect to my research Guide Dr.

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Toufic Ahmad Choudhury, Professor and Director, Center for Post Graduate Studies (CPGS), BIBM, Dhaka for his inspiring guidelines, valuable suggestions, constructive criticism and constant help throughout the research work and in preparation this report. I am deeply indebted to Dr. Bandana Saha, Professor and Director (Research, Development and Consultancy) and Dr. A. S. M. Ahsan Habib, Associate Professor of BIBM, Dhaka to allow me to work on my desired dissertation topic and their consistent valuable suggestion, active inspiration and constant help to construct and illustrate this work.

Indeed I am grateful to all faculty members of BIBM from whom I was inspired and supported in various ways during the research and at the time of study. I am also indebted to the entire library officers and staffs of BIBM and EPB who helped me to search information and assist me when I call for. I would like to take this opportunity to express my wholehearted gratitude to my fellow friends, near and dear ones who offered encouragement, information, inspiration and assistance during the course of constructing this dissertation paper. Finally I would like to express my profound gratitude and wholehearted respect to Mr.

Atiar Rahman Mollah, Faculty Member, BIBM, for his continuous encouragement, scholarly guidance and constructive criticism throughout my research work. ————————– (Mukti Chakraborty) MBM 10th Batch, Roll No. : 100616 BIBM Chapter no:TitlePage No. PrefatoryI-V Letter of TransmittalI AcknowledgementII Table of ContentsIII-IV Executive SummaryV Chapter 1: INTRODUCTION 1-8 1. 1Background of the Study 1 1. 2Research Objectives 5 1. 3Scope of the Study5 1. 4Methodology6 1. 5Limitations of the Study8 1. 6Organization of the Study8 Chapter-2: THEORETICAL REVIEW OF TRADE FINANCE9-21 . 1Export Finance9 2. 2Export Credit Guarantee scheme15 2. 3Export Development Fund 16 2. 4Import Finance17 2. 5Problems in Trade Finance19 Chapter-3: TRADE POLICY OF BANGLADESH22-42 3. 1Export Policy22 3. 2Import Policy36 3. 3Review of Exchange rate Policy41 Chapter-4: THEORETICAL REVIEW OF IMPORT AND EXPORT PROCEDURE43-60 4. 1Export Procedure43 4. 2Import Procedure49 Chapter-5: FINANCING STRUCTURE OF BANGLADESH61-69 5. 1Export-Import Trend and it’s Contribution to GDP61 5. 2Structure of Export-Import Finance of Bangladesh65 5. 3Export Financing and Export Performance67 5. Import Financing and Import Expenditure68 5. 5The Changing Degree of International Openness 68 Chapter-6: CONCLUSION AND SUGGESTIONS 70-73 Bibliography 74 Annexure Executive Summary In the quest of her economic development, Bangladesh is striving hard through adopting various policies and strategies but achievement is much below expectations. This suggests that the country has yet to develop a suitable policy package for sustained growth and development. In this connection it may be mentioned that “Export or perish” now a days become a very popular slogan among the development economists and policy makers.

In today’s world almost all developing countries have been adopted various reform measures on order to institute open market economy. One way to expedite the journey towards open market economy is export led strategy of economic development, which has been recognized by our government officially. Current export & import policy of our country is much more realistic than that of previous years. But there has been always a wide gap between policy formulation and policy implementations, so benefits of policies could not be reaped properly.

Despite liberalization foreign trade and financial system, procedural simplification is yet to be done. Bangladesh gradually started to shift from its earlier economic development policy of import substitution to export-led growth strategy since 1982. One of the major factors in trade promotion is availability of finance to traders. Banks role to this end is very important. This report tries to explore the policies and strategies that should be followed in developing credit to boost up the sector by analyzing trade finance scenario of Bangladesh.

It is observed that more finance is needed to plug the gaps between trade finance and export or import. The change of Government policy from import-substitution to export-led growth strategy does not change the situation. Despite liberalization foreign trade and financial system, procedural simplification is yet to be done. The implications of the removal of restrictions on both exports and imports would be to enhance both the exports and imports and as a consequence would be to enhance the external trade share (export plus import) in GDP.

We have used three indicators to measure the degree of international openness of Bangladesh, namely, (i) export propensity, (ii) import penetration, and (iii) trade ratio. The changes in the degree of international openness of Bangladesh during 2001-2006 shows that all the indicators move in the same direction over the period. The external trade ratio rises from 30. 53% to 38. 64%. From the discussion the important point that comes out is the need for good governance; not only economic but also political and social. Few reforms and lucrative incentive packages could not improve the situation.

To chase the chiming challenge of globalization we need to integrate policy formulation, its implementation and have to improve law and order situation, appropriate judicial system. List of Tables Table noTitlePage no. Table 5. 1 Export and Import volume, finance and trade Openness 69 Table A. 1Export and its contribution to GDP Table A. 2Import and its contribution to GDP Table A. 3Export Earnings Vs Import Expenditure Table A. 4Export Finance by All Banks Table A. 5Import Finance by All Banks Table A. 6Export and Import volume, finance and trade Openness List of Figures

Figure NoTitlePage No Figure 5. 1Export trend of Bangladesh (1994-2006) 61 Figure 5. 2Contribution of Export to GDP (1994-2006)62 Figure 5. 3Import trend of Bangladesh (1994-2006) 63 Figure 5. 4Contribution of Import to GDP (1994-2006)63 Figure 5. 5Export earnings and Import expenditure of Bangladesh (1994-2006) 64 Figure 5. 6Trend of Export earnings and Import expenditure of Bangladesh (1994-2006) 65 Figure 5. 8Growth in Export Finance & total credit of Bangladesh (1997-2006)66 Figure 5. 10Growth in Import Finance & total credit of Bangladesh (1997-2006)67 Chapter – 1 . INTRODUCTION 1. 1 Background of the Study: During sixties and seventies, import substitution strategies were much more acceptable to planners and policy makers of the developing or underdeveloped countries against the desire of developed nations. Bangladesh, during seventies as a newly born sovereign and independent state, also favored Import substitution strategies. Bangladesh actively pursued import substitution industrialization strategies up to 1982. Then from early 80’s the Government of Bangladesh has been liberalizing foreign trade and deregulating the economy.

The policy of import substitution has been replaced by the strategy of export-led growth (Begum et al. 1998) The inward looking development strategy of ignoring the role of international trade and foreign capital in economic growth came under serious criticism since early 1970s by writings of a group of economists (McKinnon, Shaw, etc. ). They provided a forceful critique of the conventional wisdom of classical, and regarded financial repression as of the most important sources of inefficiency and poor growth of developing countries.

This view was not accepted by the policy makers of the larger group of developing economics until 1980s. Over 1990s, many developing countries not only downsized their controls on International transaction but also took great measures of structural reform. In line with the development, Bangladesh initiated external financial reforms (along with a set of other reforms) to take positive benefits of openness and global integration over 1990s. The main impetus to economic reforms and deregulation in Bangladesh took place since mid 1980s when the country was under a series of World Bank- IMF structural adjustment programs (Hossain, 2000).

Bangladesh Economy is characterized by major structural problems and as a result it is exceptionally dependent on external assistance for financing development activities and for bridging its sizeable fiscal and external deficits. An alternative to overcome the excessive dependence on external assistance is export-led growth strategy. Better export performance of the country in recent years especially in garments sector and other nontraditional sectors has brought about some hope of success in economic development through export-led strategy.

Faced with limited resource endowment and domestic market, the nation in struggling to find a way to survive in this competitive world and to minimize twin gap. From the very first day of her birth, she has been suffering from trade deficit. It has, therefore, become a permanent importance to the Government of Bangladesh to develop a strategy to reduce the trade deficit. Targeting to this a number of promotional measures have been undertaken in Bangladesh as a part of the strategy of export expansion. Finance facilities for the exporter is efinitely one of the key factors and have always been a part of the government’s export promotional strategy. Commercial Banks are the main financers of foreign trade in Bangladesh. However, since substantial amount of risks are contingent upon the several unforeseen happenings or situation like, insolvency of the trader, non-shipment or short-shipment of goods, non-repatriation of fund due to insolvency of the buyer, the refusal of accepting the consignment by the buyer, the change in the economic and political condition in the buyer’s country etc. xport-import finance is really a very complicated & risky arena. However, ‘Export-Import Finance System’ of the country could play a significant role in pursuance of Government’s export-led growth strategy. With this view in mind Government has introduced several financial incentives for exporters of our country over past several years like Export Performance Benefit (EPB) scheme, Duty Draw Back System, Bonded Warehouse System, Export Credit Guarantee Scheme, Preferential Interest Rates, Income Tax Rebate, Travel Quota Retention. Convertibility of Taka on Current Account and so on.

An export development fund has been maintained with Bangladesh Bank with a view to refinancing the commercial banks engaged in export financing, Shadaran Bima Corporation (SBC) has also been playing a significant role in export financing through export credit guarantee schemes. Other general insurance companies also have been involved in export financing through their insurance policy coverage for exporters. In case of import financing commercial bank give facility by Letter of Credit, Payment against documents, Loan against Imported Merchandise, Trust Receipt etc.

Despite high priority given to foreign trade financing, a few academicians and researchers have done in depth research on the issues relating to financing of export & import. Thus it is more or less an unexplored area to work with. The “Terms of Trade” is the rate at which one country’s goods are exchanged against those of other countries. International trade is the transaction between exporter and importer who are located in two different countries. International trade is essential for the prosperity of the trading nations because: Every country lack some vital resources that it can get only by trading with others; oEach country’s climate, labor, and other endowments make it relatively efficient producer of some goods and an inefficient producer of other goods; ands oSpecialization permits larger outputs and can therefore offer economies of large-scale production. Because of trade there will be some gains in economic welfare and they are: Availability of increased variety of goods, lower cost through economies of scale, increased competition, enhanced flow of ideas, economies of scale, promotion of competition, resource use efficiency.

Export earnings and import expenditure are important factors for the balance of payment (BOP) of a country. The balance of payment of a country is a systematic record of all economic transactions between the residents of the home (reporting) country and the residents of the rest of the world over a specified period of time. An international economic transaction has two sides: oAn import of value, which gives rise to a payment to the rest of the world. oAn export of value, which gives rise to a receipt from the rest of the world.

Trade is one of the major building blocks of this globalized world. Trade can enhance economic development of two economies by enhancing consumption and production possibilities of both. Parties or institutions which are related to international trade are: importer; exporter; different banks (issuing bank, advising/notifying/confirming bank, paying/negotiating/accepting bank, transferring bank, remitting bank, reimbursing bank, & so on); ICC, UCPDC, insurance company; EPB (Export Promotion Bureau); BB (Bangladesh Bank); DEDO, Ministry of Commerce and so on.

Constant developments and changes are taking place in the international trade practices due to changes in technology and introduction of new practices by the bankers, commercial parties, transport and other companies. Moreover, the important decisions by courts and arbitration tribunals have made it necessary to revise the governing regulations. The developments like URR 525 and DOCDEX rules related to documentary credit, URCB-524, URDG-458, URC-522 and EDI credit, etc. could fulfill the long felt need of the business community, bankers, ommercial parties, etc. Trade policy in a country refers to the set of policies, which govern external trade sector of its economy. In a developing country like Bangladesh, trade policy is one of the main economic instruments, which is used to suit the requirements of economic growth. In recent years, Bangladesh’s trade policies revolve around the instruments and techniques of export promotion and import management. The Ministry of Commerce formulates export policy of Bangladesh under the Imports and Exports (Control) Act, 1950.

The existing export policy (2006-2009) is valid until the next export policy is announced. Government of Bangladesh formulates Import Policy under the Imports and Exports (Control) Act, 1950 through the Ministry of commerce. The last 5-yearly import policy (1997-2002) had been effective from June 14, 1998 to June 2002. The existing Import Policy came into effect from March 13; 2004. Import of good into Bangladesh is regulated by the ministry of commerce through the issuance of Import Policy Order time to time by the office of the Chief Controller of Imports and Exports.

There are different modes of trade payment namely cash in advance, open account, documentary collection and documentary credit. Among these, documentary credit has been observed to be used mostly in our country. ICC’s (International Chamber of Commerce) Uniform Customs and Practice for Documentary Credits (UCP-600) is widely used. UCP-600 is an international codification of actual business practices, based on the experience of bankers, exporters and importers. Foreign Exchange Regulation Act, 1947 was adopted in Bangladesh immediately after independence.

The main objectives of the act are to conserve the limited foreign exchange resources and to ensure that the available foreign exchange is utilized only for priority requirements in the economic and financial interests of Bangladesh and the maintenance of the proper accounting of foreign exchange receipts and payments. Bank’s role in International Trade is to facilitate payment, and provide finance. Now the questions may arise: 1. What is the current trend of international trade in Bangladesh? 2. What re the trade policies of the country and the regulatory environment of trade financing in the context of Bangladesh? 3. What sorts of financing are needed & provided by the banks in international trade? 1. 2 Objectives This study examines the Growth of International Trade and its financing scenario in Bangladesh. More specifically, it attempts: ? To examine the current trend of international trade in the context of Bangladesh. ?To analyze the trade policies and regulatory environment of trade financing in Bangladesh. ?To review the financing of international trade and role of banks in Bangladesh . 3 Scope of the Study: This study gives a bird’s eye view of Growth of International Trade and its financing structure of Bangladesh in accordance with its export-led growth strategy for economic development. The study is specifically focused on the scope and problems of foreign trade financing of all Banks through their dealer branches. 1. 4 Methodology: This research is basically descriptive in nature. Keeping the background and the specific objectives in mind, related available information (both primary and secondary) have been collected for thorough analysis.

For primary data, a questionnaire survey has been conducted from different officials, exporters and importers. Discussion with several bank officials, academicians, researchers, exporters and importers have been done. For secondary data, journals, newspapers, periodicals and other reading materials have been consulted. Informal discussion with the officials of Export Promotion Bureau, Sadharan Bima Corporation, Duty Exemption & Draw Back Office (DEDO), different Commercial Banks (both Public and private) have also been done. Research QuestionInformation

RequiredInformation SourceHowTasks to be done 1. What is the current trend of international trade in Bangladesh? Trend of Export earnings and import expenditure; Contribution of Export and Import to GDP Secondary sourcesSorting out ‘Bangladesh Economic Review’ and ‘International Financial Statistics’; informal discussion with the officials of BB and EPB, different academicians, researchers and policy makers. Library work 2. What are the trade policy of the country and the regulatory environment of trade financing in the context of Bangladesh?

Present trade policy and Regulatory measure of trade financingBoth Primary and secondary sourcesThrough informal discussion with the official of ‘Ministry of Commerce’ and Bangladesh Bank Go through ‘Bangladesh Economic Review’Taking interview of the officials of Ministry of Commerce and Bangladesh Bank 3. What sorts of financing is needed & the role of the bank in international trade? Export and Import finance by all banks, Growth in Export and Import finance & total credit of Bangladesh Basically secondary sourcesThrough ‘Schedule of Bank Statistics’ Library work 1. 5 Limitations of the Study:

Here most of the analyses have been done on the basis of secondary data. Restricted access to financial information hinder in constructing excessive database to analyze the problem properly. Most recent financial data is not available. 1. 6 Organization of the Study: In order to achieve the objectives of this research, it is organized as follows: After the introductory chapter, chapter 2 comes with Theoretical review Trade Finance, Import Policy & Export Policy discussed in chapter 3. Then in chapter 4 Theoretical review of Export-Import procedure to get an idea on export-import procedure of all Banks.

Financing structure of Bangladesh is discussed in chapter 5. Finally, a conclusion is drawn with some suggestions in chapter 6. Chapter – 2 2. THEORETICAL REVIEW OF ‘TRADE FINANCE’ 2. 1 Export Finance Financing is important indeed in promoting export in competitive export market to support export-led growth strategy of the Government. Definition of the term “Export Finance”: For exporting, exporter needs to bear the burden of capital investment in different stages of production of export items and processing for export.

Therefore financing the exporter to release some of his capital burden is “Export Finance”. In the context of Bangladesh, the term ‘Export Finance’ means institutional finances for exports are available only against a firm contract or an irrevocable letter of credit. Firms producing goods in anticipation of an export order for off-the-shelf supplies are not normally entitled to the concessional export finance. Only a very few designated industries- mainly jute industries- is entitled to liberal and concessional export finance for all stages of the conversion cycles.

Some industries- 100% export oriented industries, the chief among them being fish processing units, garments industries- are entitled to similar privileges and concessions of export finance for a relatively short period. The areas where finance would be essentially needed, after one obtains an export order will be: 1. Procuring raw materials and components and manufacturing the product. 2. Refinance facilities so as to get the proceeds of export bills at the time of negotiation of export documents, soon after shipping the goods. 3. Availability of funds until the export benefits is realized. 4.

Refinance facilities for long term credits offered for the export of products. The schemes of export financing available to an exporter in Bangladesh are reasonably liberal and it may be safely stated that no export contract would normally be frustrated for lack of finance. Export credit has become an important tool of export promotion in developing countries. Owing to the inability of any exporter to finance large-scale export transactions on credit terms in many overseas markets from their own resources, they are constrained to tern to their governments and financial institutions for assistance in this regard.

To the limited extent, the exporter may be able to meet the financing needs of an export transaction through the advance payment he secures from the overseas buyer and then credit allowed to him by his suppliers, supplemented by his own funds. However, the major portion of export finance required for the execution of sales contracts or orders needs to be provided by the commercial banking system and other financial institutions. The commercial banks play a very important role in the provision of the working capital finance required by exporters.

In more developed countries, there are also specialized institutions, such as development bank and export-import banks that provide export financing facilities to meet the diverse needs of exporters. An exporter may need finance at two distant stage for an export transaction viz. pre-shipment stage and post-shipment stage. To a limited extent, the financing needs of an export operation may be met by an exporter through; (a) his own resources, (b) the amount of credit he is able to obtain from his suppliers or sub-suppliers and (c) the advance payment he secures from the overseas buyers.

The scope of supporting the financial needs of export from the sources mentioned in (b) and (c) being very scanty and uncertain, the exporter has to depend largely on his own resources, which makes the scales of his export operation limited. It is, therefore, imperative to have support from a source of finance other than exporter’s own resources in order to enhance the scale of operation in line with the envisaged export-led economic growth strategy. At the pre-shipment stage, when an exporter gets an order, he is likely to need finance for mobilizing further inputs (from home and abroad).

To be very specific, an exporter seeks financing facilities at pre-shipment stage for the following purpose: ???Import of raw material ???Cash for local procurement and meeting related expenses ???Packing and transportation of goods ???Insurance premium ???Inspection fees ???Processing of goods for export and ???Freight, port, custom and shipping agent charges. Generally an exporter seeks pre-shipment credit from his bank by presenting evidence of the firm’s export order that he has received. Such evidence could be a ‘Letter of Credit’ (L/C), or a firm’s order providing information for payment by means of other than a L/C.

But in case of export-oriented processing industries, the situation is slightly different. They receive export orders that require shipment at short notice. It may not be possible for such exporters to start production after the order has been received, if the goods are to dispatch on time. The exporter, therefore, undertake production continuously in anticipation of export orders, based on his past export volume. If he initiates the process of mobilizing pre-shipment finance only after receiving the export order, he may not be able to obtain funds in time.

In such a situation, it is necessary to extend pre-shipment finance facilities in anticipation of his export order. If the exports are made on cash payment at the time of dispatch of goods for export, exporter may not need any further financial support. This is the case if export transaction is made on the basis of a L/C providing for payment at sight. If, on the other hand the overseas buyer has sought and the exporter has agreed to extend credit, the exporter has to wait long for payment. Besides these, when goods are exported on a ‘consignment’ basis, they are not sold at the point of shipment. The goods remain as stocks broad on the supplier’s (exporter’s) account. From time to time some of the stocks are sold. In these circumstances, to improve the liquidity position of the exporter and to undertake further business activities, the exporter looks for financing facilities at post-shipment stage also. Export credit may be classified from two main standpoints-the stage at which it is provided and its duration. Firstly, the credit extended for production, processing or packing of export goods up to the point at which they are placed on board of the ships or other means of transportation is termed as the pre-shipment credit.

The financing of export goods from the stage of shipment to the date of realization of the export proceeds is known as post-shipment credit. 2. 1. 1 Pre-shipment credit: Banks in developing countries, which have introduced export finance system, have adopted flexible schemes of pre-shipment financing to provide timely financial assistance to exporters against their export orders or contracts at reasonable cost and in adequate measure. Pre-shipment credit as the name suggests, given to finance the activities of an exporter prior to the actual shipment of goods for export.

The purpose of such credit is to meet working capital needs starting from the point of purchasing of raw materials to transportation of goods for export to foreign country. An exporter can obtain credit facilities against lien on irrevocable, confirmed, unrestricted export letter of credit. Pre-shipment credit takes into the following forms: a) Export Cash Credit (Hypothecation): Under this arrangement, credit is sanctioned against hypothecation of the raw materials or finished goods intended for export.

Such facility is allowed to the first class exporters. As the bank has got no security in this case, except charge documents and lien of export L/C contract. Bank normally insists on the exporter in furnishing collateral security. The letter of hypothecation creates a charge against the merchandise in favor of the bank but neither the ownership nor the possession is passed to it. b) Export Cash Credit (Pledge): Such credit facility is allowed against pledge of exportable goods or raw materials.

In this case cash credit facilities are extended against pledge of goods to be stored in go-down under bank’s control by signing letter of pledge and other pledge documents. The exporter surrenders the physical possession of the goods under bank’s effective control as security for payment of bank dues. In the event of failure of the exporter to honor his commitment, the bank can sell the pledge merchandise for recovery of the advance. c) Export credit against Trust Receipt: In this case, credit limit is sanctioned against Trust Receipt (T. R). Unlike pledge the exportable goods remain in the custody of the exporter.

He is required to execute a stamped export trust receipt in favor of the bank, where in a declaration is made that goods purchased with financial assistance of the bank are held by him in trust for the bank. This type of credit is granted when the exporter wants to utilize the credit for processing, packing and rendering the goods in exportable condition and when it seems that exportable goods can not be taken into bank’s custody. This facility is allowed only to the first class party and collateral security is generally obtained in this case. d) Packing Credit:

In this case, credit facilities are extended against security of Railway Receipt/Steamer Receipt/Truck Receipt evidence of transportation of goods to the port for shipment of the goods in addition to the usual charge documents and lien of export letter of credit. This type of credit is sanctioned for the transitional period from dispatch of the goods till negotiation of the export documents. The drawings under export cash credit (Hypothecation/Pledge) limit are generally adjusted by drawings in packing credit limit which is in turn, liquidated by negotiation of export documents. ) Back to Back letter of credit: Under this arrangement the bank finances on export by opening a letter of credit on behalf of the exporter who has received a letter of credit from the overseas buyer but is not the actual producer of the exportable goods. The letter of credit is opened in favor of the actual producer or supplier within or outside the country. Since the second letter of credit is opened on the strength of and backed by another letter of credit it is called “Back to Back credit”.

The need for a back to back credit arise because the beneficiary of the original (export) letter of credit may have to procure the goods from the actual producer who may not supply the goods unless its payment is guaranteed by the bank in the form of letter of credit. f) Advance against Anticipatory letter of credit (Red clause & Green clause L/C): Under Red clause letter of credit, the opening bank authorizes the advising bank / negotiating bank to make advance to the beneficiary prior to shipment to enable him to procure the exportable goods in anticipation of his effecting the shipment and submitting a bill under the L/C.

But in case of Green clause L/C, the opening bank authorizes the advising bank to make advance not to procure exportable goods but also storage costs for storing the goods prior to shipment. As the clause containing such authority is printed / typed in red ink and in green ink on the top of the L/C is called Red clause and Green clause L/C respectively. 2. 1. 2 Post-shipment credit: The type of credit refers to the credit facilities extended to the exporters by commercial banks after shipment of goods against export documents.

Necessity for such credit arises, as the exporter cannot afford to wait for a long time for local manufacturers/suppliers. Before extending such credit, it is necessary on the exporters and financial soundness of the buyers as well as other relevant documents connected with the export in accordance with the rules and regulations in force. Banks in our country extend post-shipment credit to the exporters through: a) Negotiation of documents under L/C: Under this arrangement, after the goods are shipped, the exporter submits the concerned documents to the negotiating bank for negotiation.

The documents should be negotiated in accordance with the terms and conditions and with in the period mentioned strictly in the letter of credit. b) Purchase of DP & DA bills: In this case, the banks purchase/discount the DP (documents against payment) and DA (documents against acceptance) bills at rate published by the Exchange Rates Committee off authorized dealers. While doing so, the bank should scrutinize all the export documents separately and minutely and clear instructions to be obtained from the drawer of the bill in regard to all-important issues related to the negotiation of the bills. ) Advance against Bills for collection: Banks generally accept export bills for collection of proceeds when they are not drawn under a L/C or when the document, even though drawn against a L/C contains some discrepancies. The bank generally negotiates bills drawn under L/C, without any discrepancy in the documents, and the exporter gets the money from the bank immediately. 2. 2 Export Credit Guarantee Scheme (ECGS): Sadharan Bima Corporation (SBC) introduced Export Credit Guarantee Scheme with effect from 01. 01. 78 through its Export Credit Guarantee wing as per he direction of the Government of the People’s Republic of Bangladesh in order to promote national export. The primary objective of Export Credit Guarantee Department (ECGD) is to boost up and strengthen the export promotion drive in Bangladesh by- 1) offering guarantees to banks and financial institutions to enable exporters to obtain easily better loan facilities from them both at the pre-shipment and post- shipment stage, 2) providing a range of credit risk insurance covers to exporters against losses resulting from both commercial and non-commercial (political) risks in respect of goods sold to foreign buyers on credit.

At present the following finance guarantees and policy are issued by ECGD: a)Export finance (pre-shipment) guarantee. b)Export finance (post-shipment) guarantee. c)Whole turnover export finance (pre-shipment) guarantee. d)Export payment risk policy (formerly known as comprehensive guarantee). 2. 3 Export Development Fund: Export Development Fund (EDF) has been created jointly by the IDA and the Government of Bangladesh (GOB) for financing imports of raw materials and spare parts of export oriented manufacturers in order to diversify export and to promote and encourage non-traditional and higher value added export.

Objectives of EDF are to contribute in long term development of non-traditional export by a)assuring a continued availability of foreign exchange b)encourages foreign suppliers, overseas confirming houses and foreign commercial banks to provide short term credit to our exporters and c)Complementing other export development policies, such as improved access to duty-free imported inputs and to promote non-traditional exports, diversify exports and encourage higher value added exports. From the above literature we can get idea that in export financing system of ur country, four parties are involved. Firstly exporter who needs the credit. Secondly, commercial banks which extends the credit to exporter to ease the export. Thirdly, Bangladesh Bank that works as guardian of the whole financial system. It regulates and formulates policy for export finance, which is maintained by commercial banks to boost up the priority sector of the economy. Finally, Sadharan Bima Corporation provides guarantee in favor of exporter to bank or other institution, which is a major support for exporter. This is in short the whole export financing system.

I would like to study the factors within these parties that hinder export credit in our country. 2. 4 IMPORT FINANCE: Imports into Bangladesh are regulated by legal framework and import policy. The main regulatory bodies to control imports and supervise the implementation of exchange control requirements are C. C. I & E and Bangladesh Bank. The various methods of Import Trade Financing are as follows: 2. 4. 1. Documentary Letter of Credit: The documentary letter of credit constitutes the most important method of financing import Trade.

The letter of credit has been defined as an arrangement whereby a bank acting at the request of the customer is to make payments to or to the order of the beneficiary or is to accept and pay bills of exchange or to authorize another bank to effect payment or to accept and pay bills of exchange or authorize another bank to negotiate against presentation of stipulated documents provided that the conditions of the credit are complied with. 2. 4. 2 Post Import Finance: 2. 4. 2. 1. PAYMENT AGAINST DOCUMENTS (PAD):

On receipt of import bills from the negotiating bank, the issuing bank must examine all documents to ascertain whether those are drawn as per credit terms and all terms and conditions of the credit are complied with. If the issuing bank finds the documents in order or if the discrepancies are acceptable to the importers, the import bill are lodged by Debit to PAD account. The foreign currency amount of the import bill is converted to Bangladesh Taka by applying B. C selling rate prevailing on the date of lodgment.

The importers are to retire the documents by paying bill amount plus interest from the date of negotiation up to the date of payment. 2. 4. 2. 2 LOAN AGAINST IMPORTED MERCHANDISE (LIM): When the importers unable to retire the import bills from their own sources and approach to issuing bank for clearance of goods under LIM A/C, the bank examine he proposal and evaluate the credit worthiness of the applicant considering all relevant aspects and may sanction LIM for a very short period (30 days for commercial goods and 60 days for industrial raw materials) on the basis of bankers-customer relationship.

The bank usually asks the importers to pay some additional margin on bill amount and to bear all clearing expenses and duty VAT and other charges. The importers are to pay the loan amount and interest thereon within the stipulated period. The imported goods are stored in a go down under bank’s lock and key duly insured against risks of fire and other risks-until all banks dues are paid. 2. 4. 2. 3 LOAN AGAINST TRUST RECEIPT (LTR): Many public sector importers and some private sector importers with excellent reputation are sometimes accommodated with LTR facilities for clearance of imported goods usually capital machineries.

The importers adjust the LTR with interest within the validity of the period sanctioned by the bank. 2. 4. 2. 4 HANDLING OF COLLECTION DOCUMENTS: When documents are drawn under credit is received from the overseas correspondent on collection basis due to discrepancies, the same are released to the importers against payments. 2. 4. 2. 5 D. A. BILLS/D. P. BILLS: Documents not drawn under L/C are handled as per provisions of URR and either delivered to the buyers against payments or acceptance as per guideline given in the forwarding letter.

Bills amount are remitted to the foreign correspondents as per their instructions. 2. 5 Problems in Trade Finance Identified problems may be discussed under following broad heads: ???Absence of knowledge ???Unskilled human resource ???Closed mentality ???Inadequate equity ???Collateral security ???Concentrate on traditional commodities ???Socio-economic infrastructure ???Unethical practice ???Extra privilege ???Red tape-ism ???Insufficient backward linkage 2. 5. 1 Absence of Knowledge Shortage of proper knowledge is one of the most important set back of export-import & trade finance.

Due to lack of proper knowledge the trader could not construct a full proof sales-purchase contract to protect his interest and could not prepare discrepant free documents. Again the bankers also fail to identify the shortcoming. As a result almost all bills are discounted or reject by the scrupulous foreign buyer taking advantage ignorance. Consequently bankers are relaxed or avoid to negotiate bill and unwilling to extend their credit to avoid the risk. 2. 5. 2 Unskilled human resource Scarcity of resource personnel is another most important problem.

Not only in the foreign trade sector but in every sector proper person is not placed in the proper place. As result nothing is moving smoothly. 2. 5. 3 Closed mentality Block mind or closed mentality is also a problem. Due to those respective personnel holding the idea that trade finance generate no income; it is not a profitable business for the institute. 2. 5. 4 Inadequate equity Shortage of equity is another phenomenon to hinder the growth. Due to lack of equity our exporter & importer could not utilize the capital-intensive technology to minimize the cost of commodities to make it competitive for the world market.

This also shrinks the spread of profit and discourages to finance the sector. 2. 5. 5 Collateral security Requirement of collateral security is an ambiguous phenomenon in trade finance. According to Government policy purchase/sales order is sufficient enough to cover the credit but the banks do not feel so. So there is a conflict between trader and banker being providing collateral security to get credit facility. 2. 5. 6 Concentrate on traditional commodities Not only the trader but we the whole nation is the one eyed gene of fairy tale.

We are afraid of innovative or to take the venture rather to follow the previous track. This implies we are concentrate on same traditional commodities, which makes the market saturated and less profitable. 2. 5. 7 Socio-economic infrastructure Socio-economic infrastructure is one of the major problems to the growth of trade finance. Instable political situation, strike and so on disrupt the production cycle, cost overrun of the commodities due to the time overrun, missed the shipment date and finally turn the shipment into stock lot. 2. 5. 8 Unethical practice

Unethical practices like bribery also hinder the growth. Custom clearance process is as shabby as before the cost of clearance process is one of the highest in this part of the world. These increase the costing of commodities and make it uncompetitive to the world market. 2. 5. 9 Extra privilege Extra privilege is also a problem. Due to getting privilege the trader losses competitive mentality to survive in the market. They always demand more and more of it as a right. On the other hand banks are very much relaxed to finance the business at a concessional rate of interest. 2. 5. 10 Red tape-ism

Red tape-ism is one of most important problem to be tackled. Every sector is suffering by red tape-ism and unnecessary bureaucracy. These make the project unfeasible to present competitive market. Chapter – 3 3. TRADE POLICY OF BANGLADESH. 3. 1 Export Policy Since independence the basic development approach followed by the Government has been encouragement of import substitution. So our trade policy has been biased against export promotion. But the limitations of this approach, particularly in our context in the changed regional and global economic perspective, are now increasingly realized.

Many import-substituting industries are unable to take the advantage of economies of large-scale production and experiencing huge losses. In this backdrop export-led and export-oriented economic growth through private sector is much- desired alternative. Export Promotion Bureau formulates export policy of our country in co- ordination with other ministries and government agencies (Bangladesh Bank and National Board of Revenue for example). Ministries and Government agencies issue circular according to the export policy in their relevant field. . 1. 1 Historical Review of Export Policy Bangladesh Government’s willingness to achieve export-oriented economic development was first evidenced in 1978 when the Export Promotion Bureau (EPB) started functioning as a semi-autonomous body to promote export. The services of the EPB include assistance in formulation and implementation of export policy, product and market development, rationalization of exports incentive system, participation in international trade fairs and provision of export support and functional advisory services.

In 1980 introduction of Export Processing Zones Authority Act. 1980 has opened up another door for export-oriented development. Industries in Export Processing Zone (EPZs) of Bangladesh enjoy a highly competitive package of incentives which includes tax holiday for 10 years, exemption of income tax on interest on borrowed capital, duty free import of machinery’s, equipment, raw materials and export of goods produced in the zones. Foreign nationals receive complete exemption from dividend tax for tax holiday period.

The entrepreneurs also receive a number of non fiscal incentives including full repatriation of profit and capital, liberal employment of foreign technicians / experts, repatriation of capital investment including capital gains, back-to-back L/C facilities for certain types of industries for import of raw materials, exemption of customs duties and sales tax on import motor vehicles for executives of EPZ enterprises. From mid 1980s several export incentives were introduced to overcome the difficulties of our narrow export base and help to keep our products competitive.

In the field of export financing following incentives were introduced. Concessional interest rate of export credit was fixed at 7% for traditional items and non-traditional items. In addition, incremental incentives on interest were allowed to outstanding exporters who would exceed the export earnings of the previous year by more than the target set for the sector. Now there is an interest rate band of 7. 00-9. 00% on all export credit including jute and jute goods. Commercial banks would provide export credit to the extent of 90% of the value of confirmed and irrevocable letter of credit or firm sale contract.

This extent of export credit still prevails. On the basis of foreign L/C back-to-back L/C may be arranged for procurement of export goods. This system of financing still prevails. Cash Assistance at the rate of 15% of f. o. b value of export would be provided to those garment industries, which would not avail of bonded warehouse or duty, draw back facilities. Under bonded ware house facility duty free import of raw materials is allowed. In the present policy cash assistance has been provided to indirect exporters ( local textile produced for RMG industry) at the rate of 25% of FOB value.

Concessional rate of import duty for capital machinery’s and spare parts at the rate of 2. 50% was introduced in the export policy of 1985-86. In the current export policy duty free import of capital machinery is allowed for 100% export oriented industries. Previously this facility was enjoyed by the industries located in the EPZ. Provision for rebate on insurance premium to export-oriented industries (non- traditional items) in respect of their premium payments for fire and marine insurance were introduced in mid 80s and carried out till now.

Bangladesh Biman and the Shipping Corporation introduced special inducement and promotional freight rates. At the same time provision to provide same export benefits to “Deemed Exporters” was introduced. Current export policy carries out this provision. Export Performance Benefit (XPB) scheme were introduced in 1985 to enable the exporters to receive higher value for their products in place of cumbersome XPB/IEC system. Under this scheme 3 slabs of XPB entitlement for various items were fixed at 100%, 70% and 40%.

The exporter would receive their proceeds at a rate calculated by adding to the official rate of exchange a premium represented by the proportionate difference between the secondary and the official exchange rates, under any of the 3 slabs. Bangladesh Bank would provide refinancing under this scheme. In 1992 this scheme was abolished as official and secondary exchange were unified by policy changes. Duty Draw Back Scheme introduced in 1970 under Customs Act 1969 has been in use since then. Under this scheme an exporter of manufactured product is entitled to get back the customs duty, sales tax etc. lready paid on importation of raw materials used in the production of goods exported. Duty Draw Back Scheme has been strengthened further in the export policy of 1997-2002 by making refunds more automatic through the incorporation of further refinement in the system. From mid 80s Sadharan Bima Corporation introduced Post-shipment Export Credit Guarantee Scheme (ECGS) in order to provide guarantee to bankers and exporters against possible losses resulting from advances given and against the overseas commercial and political risks, respectively.

In 1986 the frozen food sector was identified as ‘Thrust Sector’ and a high level monitoring committee was set up to assess the development requirement of the sector to arrange for necessary inputs, ensure implementation of various hatchery projects, monitor the export market on a regular basis. The Thrust sector of 1997- 2002 policy are RMG, Leather & leather goods, Software, Agro-processing industry In the present policy this incentive is absent.

Instead a ‘Crash Program’ has been taken up in order to boost production and promote export of the items like toys, baggage and fashion goods, electronic goods, electronic items, jewelry, silk fabrics, stationary items, artificial flower and orchid, gift items, vegetable and engineering and consultancy services. In 1989, Export Development Fund was created with financial assistance from IDA to facilitate financing of imported raw materials, spare parts, and accessories to be used in the manufacturing of non-traditional items.

Bangladesh Bank provides refinancing facilities to commercial banks from this fund, proposed to the tune of 30 million US Dollar. In the export policy of 1991-93 a new fund named ‘Export Promotion Fund’ was proposed to be set up to provide assistance to some non- traditional items in the field of product development, product diversification and marketing. Some product specific export policies for Jute goods, Tea, Garment, Handicraft and Handloom were introduced in the export policy of 1986-87 most of which are revised in the present export policy.

Recently a separate credit line has been created to the tune of US dollar 25 million for the CIS countries. This policy might bring positive impact on our export if utilized properly. Convertibility of Taka on current account in October 1993 is timely decision, which would remove complications in export financing. This is a desired step in our ongoing foreign exchange liberalization process. In conclusion, it can be said there has been plethora of export incentives in our export policies, but there is a wide gap between paper work and actual implementation.

Frequent changes of policy and inconsistency in the policies also frustrate the exporter community. Besides, there should be a balance between export policy and import policy in order to bring about fruitful results. Ongoing liberalization of foreign exchange and reform in the tax structure should also be in consistence with export policy. 3. 1. 2 Objectives of Export Policy (2006-2009) 1. Updating and liberalizing the trade regime in accordance with the needs and requirements of the World Trade Organization and globalization; 2.

Encouraging labor-intensive (especially female labor) export -oriented production; 3. Ensuring availability of raw material for export products; 4. Increasing productivity, and diversifying products; 5. Improving the quality of products; encouraging the use of modern, sustainable and environment-friendly technology; producing higher value products; and improving the design of the products; 6. Initiating new strategies for the expansion of the markets for export products, making proper utilization of computer technology, encouraging all modern technology including e-commerce; 7.

Assisting the development of necessary infrastructure, particularly sector-specific backward and forward linkages, in order to encourage the production of exportable products; 8. Providing all-out support to new exporters as well as to current exporters; 9. Assisting the development of a skilled labor-force through proper training to manage international trade; 10. Providing adequate guidance to merchandising societies, business organizations, business people and related individuals in understanding the changing international trading system. 3. . 3 Strategies of Export Policy (2006-2009) 1. Increasing the institutional skills and working capacity of the Export Promotion Bureau (EPB); providing assistance in capacity building of the Customs Authorities, sea and land port authorities, Department of Fisheries, BSTI, Tea Board as well as of different trade bodies; 2. Strengthening and expanding the “Product Development Council” activities through joint initiatives of the governmental and non-governmental sectors so as to encourage the production and export of export potential products; 3.

Providing assistance to producers and exporters in certain areas such as demand-related foreign market intelligence, attaining higher price etc. ; 4. Providing updated information to the exporters on export market and technology for the purpose of export diversification; 5. Creating training opportunities and establishing sector-specific training institutes for workers, staff and management people to increase productivity; 6. Providing assistance in export promotion through increased institutional facilities including trading house and export house; 7.

Providing assistance in establishing “seal of quality organization” or similar organizations so as to ensure, where applicable, the quality of the products; 8. Encouraging the establishment of design centers for the improvement of product designs; 9. Assisting producers in using modern technology for production; 10. Assisting the exporters to get familiarized with the working procedures of significantly successful exporting countries; 11. Providing financial and tax subsidies or incentives, including low-interest loans, to exporters; 12.

Reducing leave time in export by means of development of port management, infrastructure development, simplification of goods unloading, and development of the transport system; 13. Sending trade missions abroad and providing assistance to exporters to hold single trade fairs abroad as well as to participate in different international trade fairs, and thus making the products popular and creating markets for them; 14. Expanding the market for Bangladeshi products abroad by seeking duty-free market access in the United States and other developed and developing countries; 15.

Taking special initiatives to increase exports in South Asia, Middle East and other Asian countries; 16. Encouraging new production, product diversification, increased export and similar activities by recognizing the largest exporters as CIP and honoring them with National Export Trophy; 17. Reviewing and providing necessary directions about the country’s export situation annually at least once by the “National Committee on Export”; 18. Monitoring and evaluating the progress of the implementation of the decisions of the “National Committee on Export, to be done by the task force established for this purpose; 19.

Identifying the problems related to export and suggesting possible remedies, to be done by the Export Monitoring Group chaired by the Vice-Chairman of the Export Promotion Bureau; General Export Facilities Use of Foreign Exchange Earned from Export ?Exporters can deposit a certain amount of their export earning in foreign currency under retention quota in their foreign currency account. The amount of the retention is to be fixed from time to time by the Bangladesh Bank.

Exporters can use this foreign currency for real business purposes, such as business-related foreign trips, participation in export fair and seminars abroad, importing raw materials, equipments or spare parts, and setting up offices abroad. oExport Promotion Fund — There shall be an Export Promotion Fund (EPF) at the EPB. The following facilities will be provided from this fund: ?Providing venture capital with lower interest rates and soft terms for production; ?Assisting the producers/ exporters to receive foreign technical assistance, service and technology for the purpose of product development and diversification; Assisting exporters to send marketing missions abroad and to participate in international trade fairs; ?When necessary, assisting exporters to set up sales and display centers as well as warehousing facilities abroad; ?Assisting exporters to participate in training programs abroad on product development and marketing, so as to enable them to improve their technical and marketing skills; ?Providing assistance in other activities related to product and market development. oOther Financial Facilities The possibility to provide tax exemption and subsidy in services sectors such as electricity, water and gas, instead of cash benefits, will be considered; ?Initiatives will be taken to develop necessary infrastructure to ensure seamless supply of electricity, gas and water for all export-oriented industries; and ?Initiatives will be taken to fix the electricity, water and gas charges for industrial use at a reasonable level. oProviding Fund for Export ?Import procedures of raw material and related products will be made easier under the Export Promotion Fund (EPF); Possibility to provide back-to-back Letter of Credit to other export items besides readymade garments will be reviewed; ?To promote export, loans with lesser interest rates and soft terms will be made available for capital machineries and raw materials. oExport Loan ?Commercial banks will consider, on a priority basis, the issue that exporters get a credit of 90 percent of the amount mentioned in the irrevocable letter of credit or in the confirmed contract; ?Initiatives will be taken to modernize the banking sector for the quick completion of export related activities and for making the banking sector more transparent; Bangladesh Bank will take necessary steps to keep the flow of normal credit flow seamless for the export sector; ?The bank will fix the exporters’ cash credit limit based on the achievements of previous years; ?If products are exported on the basis of site-payment under irrevocable letter of credit, then commercial banks will not impose overdue interest provided that the exporter submits necessary export documents; ?Bangladesh Bank may open up an “Export Credit Cell” for export financing for the development of this sector.

Similarly, commercial banks will create “Special Credit Unit” for export financing; ?There will be a highly empowered “Export Credit Monitoring Committee” to fix the demand of export credit, and to review and monitor the flow of credit. The activities of the “Credit Monitoring Committee” will be run under the leadership of Bangladesh Bank; ?Banks will take necessary steps to fix service charges at a reasonable level; ?If necessary, initiatives will be taken to establish/ strengthen banking facilities in order to expand trade relations with Russia, other CIS countries, and north-eastern states of India; The Export Credit Guarantee Scheme (ECGS) will be restructured, activated and made effective. The possibility of compensation for export damages will be considered under this scheme; and ?Authorized dealers will be able to open internal back-to-back LC under main letter of credit in favor of local raw material suppliers. oExemption in Insurance Premium ?Provisions will be made available for fire and naval insurance premiums under exempted rates for export-oriented industries in the unconventional sectors. Under this system, the exporter may be exempted from paying premium after shipment is made. Incentives for Export of Non-traditional Industrial Products ?Incentives will be given to unconventional and new products exports. In this respect, value addition during the first two years will have to be at least 40 percent and then onwards at least 50 percent. oBond Facilities for Export Oriented Industries ?The National Board of Revenue will consider the possibility of providing bonded warehouse facilities to import-dependent export industries. Mainly it will be reviewed whether bonded warehouse facilities can be extended to all export-oriented industries.

Also it will be reviewed if trading houses and export houses can be granted additional bonded facilities under certain conditions. oEncouragement will be given to initiate brand names to attain higher price. oAlternative incentives, instead of duty bond or duty-draw-back to export-oriented local textiles and readymade garments industries. ?Government can provide subsidies (cash incentives) as alternative incentives instead of duty bond or duty-draw-back to export-oriented local textiles and readymade garments industries. The rate of incentive will be decided by the government.

This incentive can be extended to other sectors too. oEasing VAT return on Export-Facilitating Services ?Simplified procedure will be created for the imposition of paid VAT on export-facilitating services such as C services, telephone, telex, fax, electricity, insurance premium and shipping agent commission/ bill. oGeneral Facilities for Export-Oriented Industries ?Industries exporting at least 80% of their production will be considered as export-oriented industries and they will be entitled to receive bank loans and other financial benefits; and Industries exporting at least 80% of their production will be permitted to sale their remaining 20% products in the domestic market subject to due payment of duties and taxes. oReduced Air Fare for the Export of Special Privileged Products including Fruits and Vegetables ?Biman Bangladesh Airlines will consider measures for reduced air fare for the export of fruits and vegetables, ornamental plants etc. by air. oWithdrawal of Royalty for the Expansion of Cargo Facilities of Foreign Airlines for Export Purposes No royalty is applied for transporting vegetables. Initiatives will be taken to provide similar privileges for special privileged products including fruits; and ?Initiatives will be taken for increasing the space in foreign airlines’ cargo services, and for transporting fruits, vegetables etc. at a reasonable fare. oVenture Capital Facilities for Small and Medium Enterprises ?Agricultural farms with at least 5 acre size will be given venture capital facilities to encourage the production and export of vegetables, fruits, fresh flowers, orchids etc. ; Establishment of cool chains will be encouraged to avoid quick putrefaction of the products. In this regard, import of reefer vans and reefer containers will be encouraged. oResearch and Development ?The National Board of Revenue will consider the possibility of permitting the import of machineries and equipments for research and development purposes by the exporting institutions. Research institutes may be considered to enjoy this facility upon recommendation from the Export Promotion Bureau. oEncouragement and Facilities for Exports Based on Sub-Contracting An institution can spend, before acquiring the actual work order, a maximum of USD 6,000 for communication, sending representatives, travel abroad, purchase of tender document etc. An authorization from the Bangladesh Bank will be required if more foreign currency expenditure is needed; ?Permission for establishing offices abroad, and for recruiting officials; and ?Individual professional guarantee/ insurance will be provided in favor of project specialists by general insurance. oFixation of the Annual Limits for Sending Samples of Export Products Samples of export products can be sent abroad under the following limitations: ?A maximum of USD 5,000 worth of products (except medicine) per exporter per year, valued in FOB; ?Products sent as sample and free of cost, but for medicine the conditions are: 1) maximum USD 10,000 if there is no export LC (letter of cred

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Growth of International Trade and Its Financing in Bangladesh Assignment. (2019, Nov 03). Retrieved November 12, 2019, from https://anyassignment.com/finance/growth-of-international-trade-and-its-financing-in-bangladesh-assignment-40928/