LC situation likely to improve in 2 months: Cenbank governor

The central bank governor Abdur Rouf Talukder has hoped that the current situation over opening letter of credits (LCs) is likely to ease in the next couple of months. 

The Bangladesh Bank governor made the comment while the Dhaka Chamber of Commerce and Industry (DCCI) Board of Directors called on him at the central bank's head office on 23 January, says a DCCI press release.

He reaffirmed that the Bangladesh Bank has been working tirelessly through relevant policy measures and actions such as lowering the LC margin to ensure a continuous supply of essential commodities in the market during Ramadan.

"We are facing three major challenges now – the ongoing Russia-Ukraine war, the interest rate hikes by the Federal Reserve, and the recent Covid situation in China. Despite these challenges, our economy is quite stable," said Governor Abdur Rouf Talukder.

He also expressed hope that the remittance inflow will increase considerably in the future.

In the discussion DCCI President Md Sameer Sattar said that public-private partnership (PPP) is crucial to tackle any economic challenge.

The DCCI president also emphasised the need for necessary reforms, like easing the documentary requirements for cottage, micro, small, and medium enterprises (CMSMEs) to access finance and, especially, in relation to the Credit Guaranty Scheme, for the betterment of the CMSME community.

Furthermore, he advocated for easing the documentation process for young and innovative start-ups so that they can easily obtain loans.

He also emphasised the importance of increasing private sector credit growth to accelerate the private sector's contribution to economic recovery in this geoeconomic context.

In addition, Sameer Sattar suggested ensuring good governance to contain the soaring non-performing loans by taking stern measures for quick recovery and focusing on habitual defaulters as well as necessary reforms to regulations in the banking sector.

DCCI Senior Vice President SM Golam Faruk Alamgir, Vice President Md Junaed Ibna Ali and members of the Board of Directors were also present in the meeting.