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BKMEA urges BB to provide 42 months more to repay salary incentive

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) urged the Bangladesh Bank (BB) to extend the repayment period of the salary stimulus loan to 42 months from the present 18 months.

In a letter signed by BKMEA’s President, AKM Salim Osman sent to Bangladesh Bank, said, “Repaying the loan in the next 12 months would be very tough for us, particularly for our small-scale units.”

BKMEA made the following demands to BB:

  1. Extending the repayment period of salary stimulus loan to 42 months from the present 18 months.
  2. Export Development Fund (EDF) boundary to be extended to $30 million.
  3. if a knit factory needs more than $30 million funds from EDF. It should be resolved on a case-to-case basis. Take necessary steps to increase the size of the EDF fund from $5 billion.
  4. Extension of EDF loan repayment deadline of September to 31 December 2022.
  5. To solve the difficulties arising in paying local back-to-back LCs of non-bonded garment factories – take necessary steps to revise the Foreign Exchange Transaction guideline.
  6. Requesting to give necessary instructions to increase the credit limit (back-to-back) of the banks of the garment companies by 75% due to excessive increase in the prices of all types of raw materials.
  7. requesting to take necessary steps to issue a new Master Circular providing cash assistance on FoB value directly instead of putting on clothing.
  8. Requests to assist in the development of the local industry by allowing local back-to-back LCs in the post-import financing.

In the given circumstances, BKMEA sought these demands from the central bank so the knitwear manufacturing factories cushion the pandemic fallouts.

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