Bangladesh Bank (BB) will prioritise credit flows for productive sectors like small and medium enterprises and agriculture, said its governor yesterday.

“Be innovative to give a boost to the economy,’ Dr Atiur Rahman urged the banks and entrepreneurs while speaking at a dialogue in Dhaka.

The Bangladesh chapter of International Chamber of Commerce (ICC-B) organised the dialogue on Rethinking Trade Finance 2009: An ICC Global Survey.

According to the survey findings, increased risk perception and tight credit condition have been identified as major threats to the access to trade finance.

When the central bank’s chief’s attention was drawn by some discussants at the dialogue to Bangladesh’s policymakers’ failure to reach any decision in the face of global recession because of the lack of data and poor analytical capability, Dr Atiur made an assurance that officials’ capability in this regard would be enhanced.

Admitting that BB officials could not utilise full potential of its immense statistical database, he said, “The officials do not have the capacity. I’ll take steps to increase their capacity, including strengthening the existing policy analysis unit of the BB.”

He said his role, as a regulator, would be to boost business confidence based on well-informed data. “We’ll invest more on knowledge and analysis,” he added.

When asked, BRAC Bank Chairman Muhammad A (Rumee) Ali, also a former deputy governor of the central bank, told The Daily Star after the function, “During my tenure in the BB I got everything (data) whatever needed.”

“But we have to know how to utilise those data for analysing the economy”, Ali added.

The BB governor, who dwelt on various issues like remittance, bank credit, exports, domestic demand and trade, called upon the commercial banks to open more exchange houses abroad to net more remittances.

Dr Atiur said, “The remittance may rise to $9.5 billion in 2009 providing stronger cushion to the current account balance and exchange rate stability.”

The governor believed Bangladesh has to boost domestic demand to sustain the global financial crisis fallout.

“If internal demand goes up, we’ll stand on our own feet,” he said. “But it doesn’t mean that export will be given less priority,” he noted.

He credited the BB for a healthy financial sector despite prevailing a negative situation in the world’s banking sector.

The survey, conducted by the ICC Banking Commission, covered 130 banks in over 60 countries across the globe to analyse the trade finance issue. Vincent O’Brien, member of ICC Banking Commission, Paris presented a keynote paper on the survey.

The survey found that 47 percent of the banks reported a decline in export LC, while 43 percent banks reported a fall in LC value of aggregate transactions.

Mahbubur Rahman, the ICC-B president who chaired the dialogue, hoped that the survey would provide bankers and other stakeholders with some basic data and useful information for their strategic planning in conducting foreign trade.

Professor Mustafizur Rahman of the Centre for Policy Dialogue, Professor MA Taslim of Bangladesh Foreign Trade Institute, Dr Toufiq Ali, a former ambassador to UN in Geneva and WTO, Zaidi Sattar of Policy Research Institute and Mamun Rashid of Citibank NA took part in the discussion.