Steps to be taken to clear export proceeds by crisis-hit banks: Governor
Govt to also take measures to resolve the issue ‘permanently and conclusively’
Highlights:
- Troubled banks withholding exporters' proceeds, disrupting wage payments
- Over 200 garment exporters affected, BGMEA seeks Bangladesh Bank help
- BB governor assures temporary measures, plan for permanent solution
Bangladesh Bank Governor Ahsan H Mansur has assured that crisis-ridden banks will be directed to pay exporters their due share from export proceeds, with a plan for a permanent solution to follow.
"Temporarily, steps will be taken so that banks pay their customers from the export proceeds, ensuring exporters can meet urgent financial needs," he said during a meeting with leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) today (26 August), according to a press release issued by the trade body.
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"Later, necessary measures will be adopted to resolve the issue permanently and conclusively," the governor added.
Currently, several troubled banks are now unable to settle back-to-back LC payments and exporters' dues, even after export proceeds have been received, leaving exporters unable to pay wages and other expenses, and fuelling fears of looming labour unrest.
BGMEA President Mahmud Hasan Khan Babu told The Business Standard earlier that more than 200 garment exporters are suffering due to this crisis.
BGMEA urges immediate solution
At today's meeting, the BGMEA president told the governor that severe liquidity shortages at five banks have led to significant disruptions. Even when export proceeds are received, the payments to exporters are delayed, and the banks are unable to open new LCs, he said.
"This has pushed many garment factories into heavy financial losses, preventing them from carrying out regular operations and export activities. Factories are struggling to pay wages and allowances on time, fueling growing worker unrest that could turn into a law-and-order problem," Mahmud said, calling for swift and effective steps from the government.
He further warned that the situation is tarnishing Bangladesh's image abroad and eroding buyers' confidence in the country's garment sector, posing serious risks for the industry.
At the meeting, BGMEA leaders expressed deep concern, cautioning that unless swift action is taken, many enterprises may soon become sick industries, leading to large-scale job losses and jeopardising the country's main export sector.
