Import orders dwindle again in Dec amid political unrest

January 29, 2015

The country’s import orders decreased by 7.03 per cent in December 2014 against a 5.23-per cent growth in November as the businesspeople again adopted a go-slow policy to business expansion due to the recent spate of political unrest and uncertainty, said officials of Bangladesh Bank.
According to the BB data released this week, the opening of letters of credit, generally known as actual import orders, stood at $3.49 billion in December of 2014. The figure was $3.76 billion in November and $3.14 billion in October.
A BB official told New Age on Wednesday that the country’s import orders had increased sharply in the recent months before December as the businesspeople had started to expand their business amid an eased situation in the political zone.
But, the opposite political parties led by the Bangladesh Nationalist Party announced fresh political programmes late December of the last year that discouraged the businessmen to open fresh LCs, he said.
The import orders may decrease more this month as the country has been facing a blockade since January 5, he said.
The BB data showed that the import orders for capital machinery declined massively in December as the businesspeople had almost stopped to expand their industrial units.
LC opening for the capital machinery decreased to $268.76 million in December from $462.83 million in November of 2014.
LC opening in December for cotton yarn and textile accessories were worth $17.24 million and $3.95 million respectively against $21.22 million and $4.22 million in November.
In December, LC opening for pulses and onion were worth $14.40 million and $14.64 million respectively against $38.18 million and $15.46 million in November.
The BB official said that the negative growth in LC opening meant that the import would decrease in the months to come.
The BB data showed that the settlement of LCs, also known as actual import, also posted a negative growth of 1.54 per cent in December compared with that of a negative growth of 3.75 per cent in the previous month.
In December 2014, LCs worth $3.20 billion were settled by banks. LCs worth $3.25 billion were settled in November and $3.14 billion in October 2014.
The BB official said that it was a negative sign for the country’s business sector that both LC opening and settlement entered in the negative zone in December, he said.
It is a bad signal to the macroeconomic situation as it will squeeze the country’s overall economic volume, he added.

-With New Age input

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