The ongoing dollar shortage has severely affected border trade between Bangladesh and neighbouring Myanmar.
The Bangladesh Embassy in Myanmar issued official documents where it highlighted the potential consequences of the greenback crisis, suggesting that it may lead to an increase in illegal money transactions such as hundi.
The Bangladesh Embassy in Myanmar cited the decline in Rui fish imports from Myanmar as a demonstration of the challenges faced in border trade between the two countries.
According to the embassy’s reports, Myanmar exported over 1,000 tons of Rui fish to Bangladesh in January of this year, generating revenue of $2.5 million.
However, the volume of exports dropped to only around 200 tonnes in March.
The reports noted several recommendations, including upgrading of the Teknaf port and arranging deals between banks in both countries to facilitate trade.
According to the Bangladesh mission, state-run Sonali Bank, which has been facilitating money transfers for Myanmar-Bangladesh border trade, reported depletion of US dollars.
Consequently, the bank has ceased issuing them since the last week of March.
Similarly, Agrani Bank has restricted funds citing a software issue.
The border trade between Bangladesh and Myanmar, specifically through the Teknaf and Sittewa border points, raised concerns regarding the issuance of Foreign Demand Drafts (FDDs) regulations by the Bangladesh Bank.
The FDDs are required to be exclusively issued by Sonali Bank’s Teknaf branch, causing undue pressure on the branch and resulting in an imbalance in its financial position, according to the Bangladesh mission.
The mission further recommended distinguishing cargo movements through the Teknaf border as international trade, thereby aligning the treatment and regulations for such transactions accordingly.
It also suggested designating the Teknaf port as an international port to facilitate international trade operations.
Besides, the mission proposed the signing of a bilateral memorandum of understanding (MoU) between private or state-owned banks from both countries, to streamline trade processes and enhance trade facilitation measures.
The documents disclosed that Myanmar faces no obstacles when conducting international trade through the Sittewa port.
Treating cargo movement via Teknaf as international trade would not only promote transparency but also simplify trade operations for businesses on both sides of the border.
Consequently, exporters and importers would be able to obtain FDDs from any branches of Sonali Bank in Bangladesh.
The Bangladesh mission mentioned that thousands of tonnes of agricultural products are exchanged annually through the ports, with exports valued at $5.58 million and imports valued at $0.12 million from October to December 2021.
The traded goods between Bangladesh and Myanmar encompass bamboo, ginger, peanuts, saltwater prawns, fish, blankets, candy, plum jams, footwear, frozen foods, dried plums, garlic, rice, mung beans, chemicals, leather, jute products, tobacco, plastics, wood, knitwear and beverages.
