The advent and continuing challenges of the financial crisis has seen a dramatic increase in payment defaults and discrepancies leading to disputes between trading partners in international trade, said ICCB President Mahbubur Rahman while inaugurating the daylong workshop on International Trade Finance: Cases Analysis and Solutions organised by the International Chamber of Commerce Bangladesh in Dhaka on Wednesday (March 9). This increase in risk has seen a surge in returning to the use of the traditional trade finance instruments such as commercial letters of credit and standby letters of credit by the parties.

According to the recently published global survey Rethinking Trade Finance 2010 on trade finance by the World Trade Organisation (WTO), 34% of respondents had seen an increase in refusals, 44% had seen an increase in claims under standby LCs, 23% of respondents (up from 12% in 2009) had experience an increase in the number of court injunctions stopping payment under bank undertakings and 73% of respondents experienced increases in confirmation, he added.

ICCB President noticed that international trade injects global competitiveness and hence the domestic business units tend to become very efficient being exposed to international competition. Due to the integration with the world economy the entrepreneurs can have easy access to the technological innovations. Therefore, there is an urgent need for advanced knowledge in documentary credit operations and management and essential for the professionals to be proficient in the international trade finance, Mr. Rahman concluded.

Chairman of ICCB Standing Committee on Banking Technique & Practices, Mamun Rashid in his welcome address said that presently more than 80% transactions are made through open ended UCs. So he hoped that Bangladeshi exporters within the shortest possible time will be able to follow the international practice.

ICCB Secretary General Ataur Rahman, while speaking on the occasion said that since 2008 ICC Bangladesh, besides organizing workshops on different significant issues to strengthen the capacity of the bankers, who deal in international trade as well as the exporters, has been hosting regular IFC FIT Initiative (Finance of International Trade) and Certified Documentary Credit Specialist (CDCS) Examination. He hoped that the participants would also take advantage of these programmes.