KARACHI: Governor State Bank of Pakistan (SBP) Jameel Ahmad on Wednesday said that the UAE has rolled over $2 billion loan and assured the businessmen of facilitating their imports on a suppliers’ credit.

During a meeting with the office-bearers and members of the Karachi Chamber of Commerce and Industry (KCCI), he said that the UAE rolled over $2 billion today.

A large number of importers present in the meeting demanded of the central bank for the immediate release of nearly 5700 containers of import goods, which are stuck at seaports and sought the EFI permission for imports.

Jameel Ahmad assured the tradesmen that the central bank will be facilitating imports made through a suppliers’ credit or on guarantees of international agencies.

However, he made it clear that dollars buying for imports through the local market will make issues further complicated for the country.

He acknowledged that the country is facing a number of challenges, which he said, the SBP is trying to solve in collaboration with the businessmen.

Replying to the traders’ questions, he said that the central bank is seeking a solution to the stuck containers, demurrage issues and LCs.

Issues related to foreign exchange to be addressed soon: SBP governor

The SBP has evolved a three-tier import category with essential commodities on the top, followed by pharmaceutical products and medical equipment, and raw materials for the export-oriented sectors on the third place, he said.

He reiterated that the SBP will look into the problems to solve them. However, he said that every import is seen important by the importers and their customers. He urged the businessmen community to put forward their suggestions about which sectors should be prioritized on the imports list.

Jameel Ahmad said that the central bank has approved 35 percent transfer of the total export proceeds into the IT products exporters’ special foreign currency accounts to help facilitate them.

The 35 percent transfer will be mandatory for banks, which the IT exporters can use for a skilled development, marketing and business promotion purpose.

He hoped that the move will help grow inflows.

Similarly, he said that the exporters can also use their foreign currency accounts with 10 percent of their total proceeds to make imports and open their LCs.

He also asked importers to consult with banks before making imports so that problems regarding the foreign exchange availability could be averted. He sought details from the importers on their stuck containers to solve the issue.

President KCCI Tariq Yousuf told the meeting that traders are in a “serious crisis” and fearing a “bankruptcy” from the prevailing economic uncertainty. He said that around 6000 containers are detained at seaports because of unavailability of dollars.

He warned that the importers will never be able to meet their orders with the global exporters if the stuck containers were not released. He also urged the central bank to scrape the “preferential import list” and sought all sectors should be prioritised.

He showed concerns that the importers’ moral and contractual obligations are at the stake from bar on LCs. “Everything is important,” he said that the traders need a module for their businesses amid the economic turmoil.

Leading textile maker Zubair Motiwala said that shipments of perishable items are decaying at ports, which he demanded should be cleared immediately. Each port detains about 300 refrigerator containers.

He warned that the country is left with a 15 days of anaesthesia stocks, as surgeries may come to a halt afterwards. Similarly, pulses and grains containers toll has grown to 5700 at ports from a dollar dearth to validate LCs through banks.

He said that imports of raw materials for making textiles for exports purposes have also stopped, as a result some industries have shut down and others are nearing to closures.

Motiwala said that the shipping companies have already warned that they will withdraw the country from its destination list if the stuck containers remained unreleased on ports The country’s future textile export is also at stake if LCs not opened, he said and sought help from the SBP in release of containers, waiver or reduction of taxes, duties, demurrage and port levies on stuck consignments and opening of LCs.

Javed Balwani, Chairman Pakistan Apparel Forum, former Presidents of the KCCI, Anjum Nisar and AQ Khalil also spoke at the meeting.

Copyright Business Recorder, 2023

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Haroon Jan 19, 2023 08:58am
Jameel Ahmad's inexperience is clearly showing. Had Reza Baqir still been our State Bank Governor, things would be much better than they are today.
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