The central bank has increased the allocation of the export development fund (EDF) to US$ 600 million from $500 million earlier to meet the growing demand of the country's exporters, officials said Tuesday.

"We've enhanced the amount of EDF aiming to facilitate export of the country," a senior official at Bangladesh Bank (BB) told the FE, adding that other provisions related to EDF will remain unchanged.

The BB official also said the central bank was providing the re-financing facilities to the exporters through commercial banks as short-term liquidity support.

"The EDF financing is allowed for input procurements against back-to-back import letters of credit (LCs) or inland back-to-back LCs in foreign exchange, by manufactures producing final output for direct export and also by producers of local deliveries to manufacturers of the final export," the central banker noted. The country's exporters welcomed BB's latest move, saying that the increased amount of EDF would help the export businesses retain its position in the global market.

"It will help the country's exporters to meet their short-term liquidity crunch," president of Exporters Association of Bangladesh Abdus Salam Murshedy told the FE.

Mr. Murshedy, also former president of Bangladesh Garment Manufactures and Exporters Association (BGMEA), said the central bank should increase the allocation of EDF considering the country's overall export growth.

News: The Daily Financial Express/Bangladesh/07-Nov-12