ICC-B President Mahbubur Rahman on July 11 stressed building efficiency on new international trade rules and acquiring adequate knowledge from recent developments in global trade to reduce risks and facilitate transactions. Without uniform set of rules to guide banks from different countries, contracting parties will not be able to traverse the maze of different national documentary credit regulations, said the president of International Chamber of Commerce-Bangladesh (ICC-B). As a result, costs of business will go up and international trade will suffer, he added.

He was speaking as chief guest at the inaugural session of a workshop on ‘Understanding the UCP 600’ in Chittagong, where ICC expert from Europe Vincent O’Brien also spoke. ICC-B organised the workshop in collaboration with German Technical Co-operation (GTZ) in order to disseminate the latest updates regarding letter of credit (L/C). A total of 65 senior officials and representatives from different garment factories of the port city participated in the workshop.

Mahbubur Rahman said documentary credit is an integral part of international trading system as it reduces risks and facilitates transactions of around US$1,25 trillion, which is estimated to be around 20 percent of the total yearly international trade that depends on L/C. Documentary credits have been very popular in South and Southeast Asia as well as Middle East region that issue more than 25 percent of the world’s documentary credits, he said.

The ICC-B president said the ICC is trying to help ensure smooth transition to the new UCP (Uniform Customs and Practice for Documentary Credits) and reduce the rate of rejections by banks caused by faulty paperwork. Being situated at the crossroads of the world’s trade routes, Bangladesh has substantially benefited, he said. “Our total international trade grew by 17.19 percent in fiscal year 2006-07 reaching $29.6 billion.”

Vincent O’Brien said UCP 600 is the latest version of documentary credit that came into effect on July 1 this year and is used by banks and commercial parties in more than 175 countries. The latest rules under UCP 600 have been made more user-friendly to suit the needs of modern business, he said.