Dhaka, Bangladesh (BBN) – The Bangladesh Bank (BB) has brought the members of two more trade bodies under its export development fund (EDF) scheme to help exporters recover their losses caused by the ongoing political unrest.

The two trade bodies are the Leather-goods and Footwear Manufacturers and Exporters Association of Bangladesh (LFMEAB) and the Bangladesh Ceramic Wares Manufacturers’ Association (BCWMA).

The central bank issued a circular in this connection on Wednesday and asked the commercial banks to provide the low-cost foreign currency loan to the members of the two newly included trade bodies.

“The manufacturer-exporters of the two trade bodies are now allowed to draw EDF finance for bulk imports against estimated requirements, based on their export performance over the preceding year,” a BB senior official told BBN in Dhaka.

He also said the revised interest rate on the EDF scheme would be applicable to the members of the two trade bodies.

Earlier on December 15 last, the central bank slashed interest on its EDF scheme by 1.0 percentage point for the next six months to facilitate exporters to recover their losses following confrontational political situation in the recent months.

The central bank has taken the latest measures as the country’s overall business activities came under tremendous pressure in the recent months following frequent spells of blockade and shutdown, enforced by the opposition parties over formation of the poll-time government.

Under the amended rules, exporters are allowed to get such foreign currency loan on payment of the London Inter-Bank Offered Rate (LIBOR) plus 1.50 per cent interest instead of the London Inter-Bank Offered Rate (LIBOR) plus 2.50 per cent earlier.

The central bank is now providing the re-financing facility to the exporters, particularly apparel and clothing sectors, through commercial banks as short-term liquidity support.

The EDF loans from the central bank were payable by the banks upon receipt of export proceeds within 180 days from the date of disbursement.

The timeframe is extendable by BB up to 270 days in case of a longer period for repatriation of export proceeds, another BB official said.

The central bank has increased the allocation of the EDF by 25 percent to $1.0 billion from the previous $800 million recently to meet the growing demand of the country's exporters.

BBN/SSR/AD-19Dec19-10:45 am (BST)