Voice of International Business

  The Central Bank of Bangladesh has made further simplification of the process of Foreign Investment in the country. They have clarified the simplification by their latest publication, FE Circular Letter No. 11, date: 17.05.2021, from Foreign Exchange Policy Department, Bangladesh Bank, Head Office.   With this publication, both bankers and foreign investors will be pleased to know that now they do not have any further barriers to open a temporary FDI account through an online application. This policy change will surely ease both the Authorized Dealer (AD) banks in Bangladesh and the potential foreign investors.   Simplification of Account Opening Procedures:   The Central Bank of Bangladesh has recently allowed banks in Bangladesh to open accounts through online applications. They published a circular letter from their Banking Regulation and Policy Department (BRPD), Head Office on 11.03.2021 (Circular letter no. 16) in this regard.   Previou...

The government of Bangladesh provides various facilities to exporters to promote export-oriented industries of the country. As part of the Export facilitation, it extends the cheapest export loan facility to the manufacturer exporters through the Central Bank of Bangladesh. Officially this loan is called EDF Loans.   History of Export Development Fund (EDF) and Its Objective: The Government of Bangladesh Established the Export Development Fund (in short EDF) in 1989 with the support of the International Development Association (IDA). The primary size of this fund was USD31.2 million. The good news is, Bangladesh Government is increasing Export Development Fund to USD5.50 billion, The Daily Star, 28.03. 2021. Though the government established EDF to promote non-traditional manufactured items export business of Bangladesh, it is now not limited to that concept. This EDF loan intends to ensure access to finance in Foreign Currencies/ Foreign Exchange for the manufacturer expor...

Smartphone Tech Meme Created by Mehfuz Ahmed, Arko -10.5 yrs, 14.05.2021 A single picture displays what he sees in a Smartphone. This picture also portrays the reality in the Smartphone market, how they are chasing the three device technology. Read More Articles You may also like  Question Bank on Foreign Exchange

  Six Most Important Things to Keep In Mind for Foreign Direct Investment in Bangladesh   Foreign direct investment (FDI) in Bangladesh does not require any prior approval from the central bank or other regulatory authority. However, there are some guiding rules from the central bank of Bangladesh for Foreign Direct Investors. Unfortunately, most often, complexity arises due to misunderstanding and misinterpretation of those rules. You can find these rules detailed in the 2(c), Section-I, Chapter 9 of Guidelines for Foreign Exchange Transactions (GFET-2018), Vol. - 1. Sometimes Foreign Investors want to use their money in the FDI account or NRTA (Non-Resident Taka Account) account. Authorized Dealer (AD) does not allow them to Debit the primary investment account. The new Company with Foreign Investment is already registered with the RJSC, but documents not submitted by Foreign Investors to the related AD within 14 days of registration/ share issue favoring non-resi...

For many of us who are working in the field of International Trade and especially dealing with import-cum-export business want to know the difference between Entre-port trade and the Re-export trade. This two types of import is done to export the imported goods again adding some profit margin on its import cost. In this article we will discuss those two terms as per import policy order 2015-2018 from ministry of commerce in Bangladesh. It will help you to understand how those two trade prcedures are handled as well as their differences.  Entre-Port Trade: Definition of entre-port trade: Entre-port trade means such a trade where imported goods are exported to a third country adding a margin to its import cost without any change, including their quality, quantity or shape.  Conditions for entre-port trade in Bangladesh: Import Permit on returnable basis from the Chief Controller of Imports and Exports will be required. Margin to be added to the import cost is minimum 5% as per I...

FOC sounds like the Incoterms, FOB. However, it is a trade term not a recognized Incoterms. People dealing with import business may have seen various types of imports. In most of the cases payments must be made for the items imported. In some cases no payment is made. Every country has its own import policies and guiding rules for international trade. Procedures for import on FOC basis also differs based on those policies and rules. In Bangladesh this procedure is guided by the Import Policy Order (in force) from Ministry of Finance. It is also termed as Import on “No Cost Basis”. What is FOC or Free of Cost Import FOC or Free of Cost import means the process of importing goods for which no payment has to be made from the importing country. When goods are sent from abroad as a gift, free sample, replacement or raw materials for producing the ordered produce in the receiving country, no payment is required to be made by the importer. There are some limits for maximum amount of such impo...

Many of us want to know about the operational exchange rate of banks and their application in day-to-day foreign-exchange-related banking activities. Customers receive different amounts of local currency for the same amount of foreign currencies in separate transactions. They often become confused. This article will help you understand the rates applied for different transactions in banks. Trade finance professionals, customers, students, and even resource persons may find this piece of writing worthwhile.  Here we will discuss the definition of the exchange rate, its different types and use, types of quotation, and how different rates are determined.  What is Exchange Rate The exchange rate means the rate at which one currency is exchanged or calculated in another currency. In other words, we can say this rate indicates how many units of one currency (for example, local currency)you need to pay to get one unit of another currency(foreign currency). Conversely, it is the rate ...