Industries Minister Dilip Barua assured the SME sector that the government has laid due emphasis on removing hassles of getting loans.

He was addressing the inaugural ceremony of ‘Integrated support of poverty and inequality reductions through enterprise development’ (INSPIRED) project at a city hotel Tuesday.

The Industries Ministry has undertaken the project to attain institutional capacity for formulating a SME development strategy in cooperation with European Union (EU).

EU ambassador to Bangladesh William Hanna was present as special guest.

Industries Secretary KH Masud Siddiqui presided over the function.

Dilip Barua mentioned that small and medium enterprises constitute 90 percent of private sector and 70 to 80 percent of non-agricultural workforce.

“It (SME sector) made up to 25 percent of national gross domestic product last year,” he said.

The six-year project will be implemented at the cost of 19 million euro, provided by EU.

Bangladesh bank and the commercial banks’ ability to provide support will be increased by the programme.

The project is also intended to widen the avenues of communication between the bankers and entrepreneurs.

It will make attempts to develop industrial clusters including of agricultural products processing, electronics, plastic goods, light engineering, furniture, textiles and leather.

“This project will enable Bangladesh in the long run sustainable economic growth,” said Dilip Barua.

Focusing on SMEs contribution to national economy, he also expected that the ISPIRED project will expedite the development of SMEs.

ABM Khorshed Alam, additional industries secretary and project director also spoke at the function. A number of small and medium entrepreneurs and senior government officials were also present.

The Daily Sun/Bangladesh/ 12th July 2012

WASHINGTON: Cash remittances sent home by migrants, a major part of developing world revenue, have grown faster than expected despite the world financial crisis, the World Bank said Tuesday.

In an update to its annual report on remittance flows, the development lender said recorded transfers increased by 12.1 per cent last year to $372 billion and are expected to hit $467 billion by 2014.

The report said the growth of remittances had helped developing countries weather the global financial storm but warned that several factors could combine to slow the growth in such transfers in future years.

"Persistent unemployment in Europe and the US is affecting employment prospects of existing migrants and hardening political attitudes toward new immigration," the report said.

"There are risks that if the European crisis deepens, immigration controls in these countries could become even tighter. Volatile exchange rates and uncertainty about the direction of oil prices also present further risks."

The countries receiving the largest sums in remittances from migrants are the developing world's giants India, China and Mexico, but those most reliant on them are more marginal economies.

The Daily Sun/Bangladesh/ 12th July 2012

Finance Minister AMA Muhith, seen among the awardees honoured by the NBR for paying highest VAT, at a function at city’s Bangabandhu International Conference Centre in Dhaka Tuesday.

Finance Minister AMA Muhith Tuesday said the new VAT law in the making will be finalised after discussing with all stakeholders, including the businesspeople.

“We believe in discussions, and so we will discuss with all stakeholders prior to formulation of the VAT law,” Muhith told a function marking the VAT Day 2012.

National Board of Revenue organised the event at city’s Bangabandhu International Conference Centre.

“As soon as the law was tabled at the cabinet meeting, it was said that there was some controversies regarding it,” Muhith said in response to a demand of business leaders for further discussing some aspects of the upcoming law.

AK Azad, President of the Federation of Bangladesh Chamber of Commerce and Industry (FBCCI), in his speech earlier, demanded that the government negotiate with district level businessmen before finalising the law.

The minister said, “I would like to say it (law) is not an old matter for the country. The country got its first VAT law in 1991, while such kinds of law evolved in the whole world in the 60s.”

Citing instances from the developed world where VAT played a key part in bringing transparency in corporate businesses, he said the system also contributed much to improving country’s businesses also.

“A revolution has taken place around the globe in accounts managements because of VAT,” he said, hoping that country’s accounting tasks would significantly be reduced by 2015.

Stressing the importance of the stratified tax collection method, he said the day is not far away when there will be no duties on external trades as the world is heading towards more openness.

In such situation, he said, the country might have to look for other means of tax collection.

The issue of increased tax collection also bears much importance as the next year’s budget will climb to 18.2 per cent GDP, from this year’s 15.5 per cent.

“The more resources the government holds, the more people to get benefits.”

The NBR says despite its limited application the system now constitutes 55 per cent of total tax collection by the internal resources collector.

The Daily Sun/Bangladesh/ 11th July 2012

Garment makers yesterday demanded to exclude the apparel sector from the central bank's new rules for loan classification, rescheduling and provisioning, as the country's highest foreign currency earning sector is passing through a critical time.

Bangladesh Bank issued two circulars on the rules of loan classification, rescheduling and provisioning on June 14, saying that an ongoing loan operation will be classified for non-repayment of any instalment within three months, instead of the six-month duration now in effect.

Term loans of five years have also been brought under the new regulation.

Leaders of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA) spoke at a joint press briefing at the BGMEA office in the capital.

BGMEA President Shafiul Islam Mohiuddin said it normally takes 120 days for repatriation of money from the exported goods, but the banking regulator reduced the period of Special Mention Account (SMA) to 60 days from 90 days.

“So, transferring the continuous loan and demand loan to SMA within 60 days is not logical,” he said.

He said the number of loan classified factories will increase with the move and banks will not be interested to give more loans to garment factories.

“The move will ultimately hamper investment flow in the private sector,” he said. He also indicated the low import of capital m

The Daily Star/Bangladesh/ 28th June 2012

Stocks continued to rise yesterday on the back of the news of compensation by the government to around 9.33 lakh small investors hit by the stock market turmoil.

The benchmark index of Dhaka Stock Exchange, DGEN, closed the day at 4,551.21 points, having risen by 150.47 points from the previous day.

“SEC's decision to implement the recommended 50 percent interest waiver on margin loan and 20 percent special quota allocation in initial public offerings for small investors acted as the catalyst for the uptrend,” said LankaBangla Securities in its market analysis.

Turnover stood at Tk 277 crore, a considerable 71.16 percent increase from the previous day.

A total of 0.85 lakh trades were executed, with 5.86 crore shares and mutual fund units changing hands at the Dhaka bourse.

Of the major sectors, banks, at 4.01 percent, gained the most, followed by non-bank financial institutions at 3.51 percent, power 2.85 percent, telecommunications 1.34 percent and pharmaceuticals 2.46 percent.

Of the 271 issues that traded on the DSE, 257 advanced, six declined and seven remained unchanged.

Grameenphone was the most traded stock of the day, with 11.31 lakh shares worth Tk 23.26 crore changing hands.

Bangladesh Submarine Cable Company and Meghna Petroleum were the next most popular stocks.

Tallu Spinning featured in the top ten gainers' chart, having advanced by 9.70 percent.

Modern Dyeing and Screen Printing was the biggest loser of the day, falling by 3.22 percent.

Chittagong's Selective Categories Index, CSEX, closed the day at 8,678 points, after gaining 246 points or 2.91 percent.

A total of 1.53 crore shares and mutual fund units worth Tk 62.70 crore changed hands at the port city bourse.

Gainers beat losers 173 to 10, with five securities remaining unchanged.

The Daily Star/Bangladesh/ 28th June 2012