Make transaction in yuan to boost bilateral trade with China: bankers
Bankers from Bangladesh and China suggested use of Chinese yuan instead of US dollar during transaction for bilateral trade, which will help in reducing cost of production and price volatility with the changing rate of the US currency.
Introduction of the Chinese currency for opening of letter of credit will also save additional costs because of the involvement of two currencies instead of three, they said.
They spoke at a daylong seminar on “Bangladesh China trade finance: role of banks” in Kunming, China on Friday.
The seminar was jointly organised by the International Chamber of Commerce (ICC) - Bangladesh, the world business organisation along with ICC China and the China Council for the Promotion of International Trade.
China is Bangladesh's largest trading partner, Mahbubur Rahman, ICC Bangladesh president, said at the seminar attended by the high-ups of the banking sector of Bangladesh and China.
The trade balance is heavily tilted towards China as Bangladesh imported goods worth $7.54 billion and exported goods worth $746.2 million to the Asian giant in fiscal 2013-14.
“As Bangladesh suffers a huge trade imbalance with China, the Bangladesh government has taken a progressive move to bridge the widening gap between the two countries and has taken initiative to boost exports to China over the next five years,” Rahman said.
A pavilion is likely to be set up at Beijing, China to possibly increase the export of eel fish and leather products, he said.
Besides, the government will open commercial wing at different important locations in China, including Kunming, Rahman said.
Md Ahsan Ullah, executive director of Bangladesh Bank, made a presentation on Bangladesh foreign exchange regulations for international trade finance and role of Bangladesh Bank in settlement of disputes related to L/C payments.
Deng Xiaoquan, senior manager of the Bank of China, presented a paper on general practice of international trade settlement in China.
Frankie Shu On Au, head of RMB products, transaction banking at Standard Chartered Bank Hong Kong, presented a paper on RMB internationalisation roadmap and latest development.
Zhao Zhenge, ICC China executive director, and Muhammad A (Rumee) Ali, ICC Bangladesh Commission chairman, were also present.
Ali Reza MD Iftekhar, chairman of the Association of Bankers Bangladesh; Anis A Khan, chairperson of SWIFT & User Group of Bangladesh; Abrar A Anwar, Standard Chartered Bank Bangladesh CEO, and Md Shafiqur Rahman, managing director of Social Islami Bank, also attended the event.