Thursday, March 20, 2014

Weekly News Clippings (March 20, 2014)

BASIC Bank slapped with Tk 10cr fine (The Daily Star, March 20, 2014)
Bangladesh Bank has fined BASIC Bank the hefty sum of Tk 10 crore for failing to control its loan growth within the mutually agreed ceiling. The state-owned lender's loan growth shot to 25.62 percent, which prompted the central bank last week to enforce the penalty stated in the agreement. BASIC Bank, however, has contested the central bank decision and appealed for withdrawal of the fine. BB in its routine investigations in 2012 linked BASIC Bank's abnormal credit growth, which ran as high as 40 percent at one point, to rampant financial irregularities, with many instances found where the bank's board of directors and top management gave out loans against false documents and inadequate collateral.

Each Rana Plaza worker to get Tk50,000 from Trust Fund (Dhaka Tribune, March 19, 2014)
A decision to give every garment worker housed at Rana Plaza will be given a compensation of Tk50,000, was made at a meeting of the Rana Plaza Compensation Coordinating Committee. This fund would be distributed among workers by the coordinating committee through bKash by April 15. The Trust Fund, backed by the International Labour Organisation (ILO), includes IndustriALL, UNI Global Union and the Clean Clothes Campaign. Currently, the Trust Fund has $8m. About $40m is needed to pay 3,000 workers or the families of those killed in the collapse on April 24 last year. At least 1,133 workers were killed and over 2,500 injured in the incident. Meanwhile, Primark would pay 20% compensation of claim for those who are missing, dead and needs long-term treatment by March 31 and plans to pay the rest 80% compensation by May.

Rmg safety: Inspections lead to fear of job loss (Dhaka Tribune, March 19, 2014)
Suspension of production in two garment factories in Dhaka has instilled job insecurity in some 6,000 workers. On March 6, the Accord on Bangladesh Fire and Building Safety, an initiative of European retailers, asked the factories to suspend production as the building was inspected flawed. . The owners of the two factories said they might no longer resume production in the building which Accord-designated hazardous. However, workers go to the factories every day hoping to get back to work.

DoE agrees to place importance on sludge management rules (Financial Express, March 19, 2014)
The Department of Environment (DoE) has agreed to add the industrial sludge management guidelines to the environment regulations. The agreement came following a stakeholder consultation organised by GIZ in the city on Tuesday. Academicians, international consultants, representatives of Bangladesh garments and knitwear manufacturers and exporters associations, and other experts took part in the discussion.  Though there are laws making installation of effluent treatment plants (ETP)s mandatory  there are no regulations to punish the perpetrator, which discharge untreated sludge. Sludge is the solid residue generated during treatment of wastewater. Currently there are no guidelines on how to dispose of this sludge in an environmentally friendly manner, which is growing concern with the rising number of wastewater treatment plants.

About 22,572 ready flats remain unsold till December last year (Financial Express, March 18, 2014)
Around 22,572 ready flats worth about Tk 215.06 billion have been on the market since December, 2013, causing an adverse impact on the country's real estate sector. According to the Real Estate and Housing Association of Bangladesh (REHAB) leaders, though local real estate business witnessed a sluggish trend in last two years, the situation deteriorated further following the country's recent political turmoil. A five-day long REHAB fair will start on March 20 at the Bangabandhu International Conference Centre in an effort to nudge the market up.

22 Bdesh missions fail to achieve export target in 7 months of FY14 Financial Express, March 18, 2014)
Twenty-two of the 51 Bangladesh missions abroad have failed to achieve respective export targets for the first seven months (July-January) of the current fiscal (2013-14), reports UNB. The key Bangladesh missions like Washington, London, Ottawa, Canberra and New Delhi failed to achieve their July-January export target while some other important missions-Berlin, Madrid, Paris, Rome and The Hague-reached their target for the period. Of the 51 Bangladesh missions, 29 met their respective export target for the July-January period of the current fiscal (FY14), according to the latest figures provided by the Export Promotion Bureau (EPB).

WB nudges nine slow projects (The Daily Star, March 18, 2014)
The World Bank in its latest appraisal found the progress of nine of its 22 development projects in the country “unsatisfactory” and accordingly drafted in action plans to expedite the projects.
Among the nine problem projects is the Siddhirganj Peaking Power project, for which the multilateral lender has committed $350 million in October 2008. To ensure completion of the project by March 2016, the WB set deadlines for the construction of the plant. However, the WB found a few projects satisfactory, including: the Emergency 2007 Cyclone Recovery and Restoration project worth $324, the Disability and Children at Risk (for $21.6 million) and the Clean Air and Sustainable Environment ($62.2 million) projects.

Power tariff hike concerns BGMEA (Dhaka Tribune, March 17, 2014)
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has expressed deep concern over the recent power tariff hike and urged the government to keep the power prices for the RMG sector unchanged to maintain competitiveness in the global market.  “The BGMEA thinks 6.96% hike in power tariff will impact negatively on ready-made garment sector as it will push up the cost of production,” the trade body said in a statement yesterday. On Thursday, BERC increased the retail power tariff by an average of 6.96% per unit.

Labour rights, safety standard below required level (Financial Express, March 16, 2014)
The Department of Inspection of Factories and Establishments has found labour rights and safety standard unsatisfactory.   The issues are: formation of trade union, insurance facility for the garment workers, daycare centre, maternal welfare, participation committee, safety record book and safety committee etc.

Bangladesh property: Dhaka’s growing high-end market (Financial Times, March 14, 2014)
Dhaka is ranked as one of the least liveable cities in the world, according to the Economist Intelligence Unit. Similarly, foreign visitors feel bewildered at how, the capital of Bangladesh manages to survive. Few Bangladeshis can afford Dhaka apartment, however Many new upmarket properties are making enterprising use of the only space left – roofs. This means that wealthy buyers can have pools and enjoy fine views across leafy Gulshan. . According to Fawaz Rob, an architect who teaches at the city’s North South University, investing in property is risky because the high-end market is prone to fluctuations and liable to wobble when there is political instability. Investors with assets use property as a means to launder “black money”, he adds.

Bangladesh ups electricity prices to offset power company losses (Reuters, March 13, 2014)
Bangladesh has increased electricity prices by about 7 percent on average for all types of consumers after regulators on Thursday approved the measure to curb losses at the country's power company.The new tariffs have taken effect since March 1 and are part of a government move to cut subsidies for electricity generation.Khan said prices will rise 6.96 percent on average per unit. BERC hiked electricity prices by about 8 percent for wholesale and retail consumers in March 2012.Operator Bangladesh Power Development Board is losing around $769 million a year by buying electricity at higher prices from privately-owned power plants and selling it on at lower prices.











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