Tea exports nominal, imports on rise

The independent, 31 July 2012

DHAKA, JULY 30: Tea exports from Bangladesh declined drastically following the substantial rise in domestic consumption, prompting many tea traders to even import the drink from abroad.
A number of local tea traders import tea from India, Kenya and Vietnam instead of buying from domestic auctions because of price competitiveness, according to sources. As a result, the total earnings from tea export fell to only $ 3.38 million during the immediate past fiscal year 2011-12. The earning, however, showed a slight upward as the figure was $ 3.20 million in the previous fiscal.
In 1990’s Bangladesh scored as the fifth largest tea exporters in the world. But the scenario has reversed and that the country became a tea importer.
Recently, the government imposed a 25 per cent duty on imports of tea to safeguard local industry. Bangladesh produces around 60 million kgs of tea a year against a local demand of 56 million kgs.
The local consumption of tea has been rising by 7-8 percent annually, in line with steady economic growth and changes in lifestyles. On the other hand, the tea production is rising at 1-2 per cent per year.
The local tea traders said they mainly import packet tea from abroad. Around five million Kg tea was imported in last fiscal.
Bangladesh has 156 tea gardens covering nearly 100,000 hectares of land. The tea gardens are mainly located in Sylhet, Moulovi Bazaar and Chittagong district.
Seeing the ever increasing demand, the Bangladesh Tea Board (BTB) has taken a plan to increase the yield to 100 million kg by 2021, but it may not be possible due to shortage of suitable planting gardens, a BTB official said.
Industry insiders said around a fourth of Bangladeshi tea is of poor quality and that prices of good tea are higher compared with those of other tea-producing countries.
Tea is sold at the country’s sole auction centre, in the main port city Chittagong, where most of it is picked up by domestic buyers.
A total of 56.70 million kgs of tea was sold at the auction in 2010, compared to 54.25 million kgs in the previous year. At present, good-quality tea sells at Tk165-180 per kg at Chittagong auction.
The government of Pakistan allowed duty free entry of 10.00 million Kgs of tea per year from Bangladesh since October 2002 and offered to increase the quota up to 15.00 million Kgs.
But Bangladesh could not utilise that quota fully as increasing internal demand pushes the price levels up in the local auction and discourages exports. Other tea producing countries like India, Sri Lanka, Indonesia, Vietnam, Kenya and some other African countries have relative advantages to supply better quality tea at lower prices that makes export market extremely competitive for Bangladesh Tea.
Some local brand, like, HRC also import tea from Sri Lanka and Kenya to meet fast-booming domestic demand.
“Local tea market is growing like anything. We imported tea to boost our domestic sale,” said a high official
of HRC.
In late-1990s earning from tea export had reached to 40 million dollars before started falling gradually. The decline was steep in the past five years as the beverage became top selling drinks in village bazaars and households.
The local production was also hampered due to lack of adequate rains and persistent drought-like situation in the country.
Early and pre-monsoon drought in the past five years has hit production even though the gardens have invested several crore taka to expand plantation.
James Finley, the second largest producer, has invested over Tk 50 crore to boost production in its 14 gardens.
“Had the weather been kind, we could have easily grown 17-18 million kilograms of tea. But prolonged drought in March-June meant we are left with around 11 million kgs. Seven out of ten bushes we planted in the past five years have survived,” said a high official of the company.
Sources said ownership disputes in dozens of smaller gardens and shrinking productivity at the state-owned National Tea Company, the third largest producer holding eight big-sized gardens, also contributed to low production.

Spanish economy shrinks faster

AFP, 30 July 2012

MADRID, July 30 (AFP): Spain’s downturn deepened in the second quarter, with the economy shrinking 0.4 per cent after contracting 0.3 per cent in the first three months of 2012, official data showed Monday.

The figures from the national statistics institute INE confirmed Bank of Spain data issued last week, compounding the problems the government faces in an economy expected not to return to growth until 2014.

INE said the second quarter outcome reflected “weaker domestic demand which was offset in part by a positive contribution from external demand.”

Earlier this month, the government said the economy would remain in recession next year, shrinking 0.5 per cent instead of growing 0.2 per cent as previously expected.

The economy was tipped to shrink 1.5 per cent this year, with unemployment hitting an unprecedented 24.6 per cent, it said.

Air France-KLM losses deepen in second quarter

AFP, 30 July 2012

PARIS, July 30 (AFP): Air France-KLM on Monday posted 895 million euros ($1.1 billion) in losses for the second quarter, as it set aside 368 million euros in provisions to meet restructuring costs.

The result marked a deterioration from losses of 197 million euros during the same period last year, and underlined the need for its restructuring plan, the Franco-Dutch airline said.

“In an increasingly uncertain global economic environment compounded by oil price and exchange rate volatility, an improvement in our productivity and costs is even more necessary,” said group chairman Jean-Cyril Spinetta in a statement.

The struggling airline group launched a three-year turnaround strategy in January to save 2 billion euros by 2015.

Revenues meanwhile rose 4.5 per cent during the three months ending June to 6.5 billion euros.

Govt signs deal with local co to build, repair 17 bridges

The Financial Express, 31 July 2012

The government Monday signed an agreement with a local construction company to build and repair 17 bridges in three districts at a cost of Tk 2.04 billion, Roads and Highway (RHD) officials said.

The small and medium bridges will be constructed in Tangail, Kishoreganj and Munshiganj districts under the deal, which was the last one of Eastern Bangladesh Bridge Improvement Project.

The RHD is implementing the improvement scheme spending around Tk 7.0 billion with the financial help of Japan and it is being executed in four stages under four packages.

A total of 117 bridges will be built and rebuilt under the project, RHD senior information officer Mohammad Abu Naser told the FE.

The RHD signed the agreement with construction company Mir Akhter Hossain Ltd at Sarak Bhaban in presence of Communications Minister Obaidul Quader.

Chief Engineer of the Roads and Highways Department (RHD) Aminur Rahman Lashkar and Mir Nasir Hossain, managing director of the construction firm, signed the deal on behalf of their respective sides.

Of the total, Japan International Cooperation Agency (Jica) will provide Tk 5.01 billion while the rest will come from the government fund.

People throng kerb market for new bank notes ahead of Eid

The Financial Express, 31 July 2012

The new-found business in exchanging worn-out and damaged currencies with new bank notes on the kerb market, though illegal, has thrived ahead of the Eid, as more than a hundred poor people are busy doing the trading at the city’s banking hub.

The people in a growing number are collecting the new bank notes from the retailers on streets around the Bangladesh Bank (BB) premises and other commercial banks in the city’s Motijheel and adjacent areas despite the risk of being cheated, as the central bank earlier in May last closed its currency exchange window on the security ground.

While visiting the areas on Monday, poorer men and women were found selling the new bank notes to pedestrians on the streets around the BB premises and the corporate branches of other commercial banks.

At the main entrance to the central bank, the retailers were charging about Tk 20 to 30 in profit for exchanging a bundle of 100 new bank notes of 100-taka denomination with old bank notes.

At least thirty to fifty people including beggars and hawkers were seen loitering in the area with bundles of new currency notes in their hands.

Fatema Begum, a woman in her 40s who hails from Gazipur and mainly begs in the city, said she somehow managed Tk 500 from her husband and invested it in selling the new bank notes collected from the central bank counter.

“Some BB staffers help us buy the bundles of bank notes in exchange for a commission of 2 or 5 per cent,” Fatema claimed.

However, the BB temporarily re-opened two counters Sunday, one for selling new currencies to the common people and the other for selling the currencies to government officials and journalists. The two counters will remain open till August 14 next.

Earlier the BB currency exchange window was closed as the central bank was listed as a KPI (Key Point Installation).

Though, BB governor Dr Atiur Rahman took some steps to take the banking service to the doorsteps of common people, he felt that the BB headquarters should not be involved with any public dealing which might cause insecurity of it.

The exchange of new currency notes with old ones is a concern of the country’s commercial banks, said BB officials.

Once, the people found it troublesome to go to the central bank to collect new bank notes. But now it has become more convenient for them to collect new notes against their damaged or worn-out ones from commercial banks in their locality, according to some BB officials.

The BB officials also confirmed that all the scheduled banks would be bound to take back damaged notes in exchange for new ones and give coins.

In the case of failure of a bank to comply with the decision, action would be taken against them, they warned.

Executive director of the BB Department of Currency Management, Dasgupta Asim Kumar, said, “We are monitoring the commercial banks’ services to the people in relation to the exchange of damaged notes with new ones.”

“We are sending several inspection teams to the commercial banks in guise of common people on a regular basis to get a clear picture of their service to the commoners,” Mr Kumar told the FE Monday.

However, the BB would ensure availability of fresh bank notes worth of Tk 175 billion, of which, Tk 110 billion was already given to the two BB counters and other commercial banks for circulation among the public, he said.

On the other hand, he said the BB premises should not be used by outsiders as a place for trading in currency notes. The new bank notes would be available only at its counters, he added.

It is also illegal to exchange bank notes with the public on the streets except banks, BB officials said.

They said punitive action would be taken against any BB official found guilty of helping the street traders in exchanging bank notes.

Indian wheat futures seen extending losses

Reuters, 31 July 2012

MUMBAI, July 30 (Reuters): India’s wheat futures are likely to fall this week on extended profit taking and fears that the government might intervene to control rising food prices.

At 01048 GMT, the August wheat contract on the National Commodity and Derivatives Exchange (NCDEX) was trading up 1.21 per cent at 1,424 rupees per 100 kg.

The contract, which rose about 21 per cent since the beginning of this month to hit a high of 1,470 rupees on July 21, fell 3.1 per cent in the previous week.

China’s cotton output may exceed state target in 2012

Reuters, 30 July 2012

BEIJING, July 30 (Reuters): Cotton output in China, the world’s top consumer and importer of the fibre, is expected to exceed the government’s 2012 target of 6.99 million tonnes, the China Cotton Association said Monday, which is already up nearly 6 per cent from a year ago.

The higher-than-expected production, up from 6.6 million tonnes in 2011, could weigh on domestic prices and dent China’s appetite for imports should overseas prices become uncompetitive.

Although planting acreage for cotton shrank by 8.8 per cent from a year ago to 7,315 mu (487.6 hectares), better soil and weather conditions and reduced crop disease are expected to boost overall production, the association said in a statement.

Cotton prices on the Dalian Commodity Exchange have fallen 9 per cent so far this year to 18,865 yuan ($3,000) as demand from textile mills has withered on the back of slumping demand for exports. A further fall in prices would narrow the advantage of imports

MoU signed for development of aquaculture

The Financial Express, 31 July 2012

A memorandum of understanding (MoU) was signed in the city Monday between the WorldFish Center and Bangladesh Shrimp and Fish Foundation (BSFF) for persuasion of joint activities for the growth of sustainable aquaculture, reports BSS.

Under this MoU, joint promotional activities including holding meetings, dialogues, conferences, research, demonstrations and advocacy initiatives, would be made to develop natural fishes and shrimp seed conservation in Bangladesh.

Detector general of WorldFish Center Dr. Stephen J. Hall and BSFF Chairman Syed Mahmudul Huq signed the MoU on behalf of their respective sides.

Prime Minister’s Economic Adviser Dr. Mashiur Rahman attended the signing ceremony as the chief guest while Principal Secretary Shaikh Md. Wahid-uz-Zaman, Fisheries and Livestock Secretary Ujjwal Bikash Dutta,Director, Economic Growth, USAID, Bangladesh Dr. Ramona EL Hamzaoui, WorldFish Center Deputy Director

General Dr. Patrick Dugan were present as special guests. As per the agreement, supports would be provided for joint activities on making the shrimp and freshwater prawn industry more sustainable with practical emphasis on reducing food safety risks concern of national and international consumers.

Addressing social and environmental issues and increasing the economic and trade benefits from the shrimp and prawn production would be the other highlights of the MoU.

Speaking on the occasion, the distinguished guests said, according to the Bangladesh Fishery Sector Road Map, there is a target of producing 3.54 million tonnes of fish by 2021 as part of the country’s Millennium Development Goal (MDG) and out of which 57 per cent is estimated to come from aquaculture.

In this context, they said the MoU is very important. They said that the current joint venture of the WorldFish Center and the BSFF would make very a positive contribution to develop the sector in a socially acceptable and environmentally sustainable manner and in compliance with the nationally and internationally recommended rules, regulations and practices.

“Bangladesh will have to go a long way to achieve the much desired protein food security, aquatic food safety, new employment generation, poverty reduction and overall economic development of the country,” they observed.

Steps taken to repair damaged roads ahead of Eid-ul Fitr

The Financial express, 31 July 2012

Condition of the country’s roads and highways is likely to improve ahead of the upcoming Eid festival as the communications ministry has taken a number of measures to repair damages of the existing arteries.

Officials said much before the month of Ramadan began, the ministry formed nine monitoring cell and opened a control room to identify bad roads of the country and take initiative to renovate those in time.

“We have also taken complaints from commuters through the ministry website so that immediate measures can be taken to redress the complaints,” said Road Division Secretary MAN Siddique.

The ministry has so far received 31 complaints about 17 highways with photographs of damaged roads since it opened the website early July. Many media reports with photographs have also helped the ministry identify those roads that are needed to be repaired.

The officials said immediately after the complaints were received through the website or control room, directives were given to the executive engineers of the specific circles of the Roads and Highways Department for taking appropriate measures.

“The RHD engineers also provide the steps taken including pictures of the improved roads after the maintenance and repair work in the website for the people,” said an official working in website development.

Some commuters who recently visited different highways including Dhaka-Chittagong Highway and the much-talked-about Dhaka-Mymensingh highway also said majority of the bad roads have been improved.

“There have been good works going on in some points of the highways in full swing, particularly in Valuka of Dhaka-Mymensingh Highway,” said Mayaz Hossain Kabyo, a businessman who traveled in different parts of the country for his business purpose.

However, some highways mainly those in Jessore-Khulna region are still in bad shape.

The RHD has around 23,000 kilometres of roads and highways under its network of which the majority of the roads was in bad shape last year due to not taking measures of periodical maintenance and repair work in right time leaving creation of hundreds of thousands pot-holes and black spots.

Earlier, the ministry complained about poor allocation for periodical maintenance and repair works but the finance ministry has allocated more than Tk 9.0 billion for this purpose in the current (2012-2013) fiscal year.

Last year the allotment for periodical maintenance and repair works was more than Tk 6.0 billion of which a large amount was taken by contractors without any doing significant work. The contractors, however, alleged that due maintenance work on the roads and highways could not be done due to non-release of the money in time.

There had also been an allegation of not providing necessary fund for the repair work for the damaged roads.

Communications Minister Obaidul Quader and Road Division Secretary MAN Siddique also frequently visit different important highways every week to see for themselves the repair works.

Asked whether the repair work was being done temporarily or on a permanent basis, the secretary said it depended on the weather.

“We want the roads to remain in good shape throughout the year so that people can move comfortably. But roads maintenance is a continuous process and the government is giving priority to it to keep the countrywide road network in good shape all the time,” he told the FE.

114 BB officials served with show cause notices for staging demons inside office

The Financial Express, 31 July 2012

Bangladesh bank (BB) has served show cause notices to its record number of 114 high officials who were staging demonstration inside the central bank for seeking promotion.

The central bank for the first time of its history on Monday issued the notice to such a significant number of officials that include 18 deputy managers and 96 assistant managers of its cash department at its Motijheel headquarters.

All officers of BB’s cash department went to the governor floor and started observing work abstention at about 9.30 AM on Sunday to press home their one point demand.

During the protest programme that had lasted for one and a half hours also seriously disrupted official works, prompting the authorities of central bank to issue the show cause notice ordering the protesters to submit their reply within August 7.

The show cause notice said the officials took part in the gathering ignoring their duties, which hampered the reputation and service of the bank through disturbing its internal discipline.

“It is considered as a punishable offense and also a clear violation of sections 19(1), 42(a) and 44(1) of Bangladesh Bank Staff Regulations, 2003,” the notice mentioned.

The protesters were also instructed to reply the reasons to the department concerned on why punishable measures should not be taken against them for breaking the discipline.

Action will be taken against the officials who will not be able to reply the show cause notice accurately, said a BB high official.

The central bank is now going on secret investigation in this regard to take necessary action against the accused officials, he added.

“We have placed proposals for allowing our promotion; we will go for next course of action unless the authorities do not accept our demand within a short time,” the officials who were served the notice said.