Rules eased for exporters to retain dollars

The Bangladesh Bank yesterday allowed exporters to retain the value-added portion of export proceeds in US dollars for 30 days instead of 15 days. 

The value-added amount refers to the part of the export receipts that are available to exporters after their import bills for back-to-back letters of credit are settled.

In August, the central bank asked exporters not to retain the value-added portion for more than 15 days in order to make the country's foreign exchange market stable.

Owing to the unprecedented import bills, the foreign exchange market has been facing an unstable situation for several months, prompting the BB to ask exporters to encash their value-added amount within 15 days.

The measure has helped the banking sector receive an additional supply of US dollars.

Since the volatility has eased to some degree recently, the BB has extended the period for exporters to retain American greenback, a central bank official said.

The BB's decision will help exporters tackle the losses stemming from the fluctuation of the exchange rate between the dollar and the taka.

Also yesterday, the central bank permitted exporters to transfer the value-added portion of export proceeds to other banks for the settlement of import bills or liabilities of the Export Development Fund.

In May, the BB instructed exporters to sell their export proceeds to the same banks through which they ship goods since many of them sold the dollars to the lenders that offered the higher rate, creating indiscipline in the forex market.