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The apparel sector apex trade-body - BGMEA - urged the government to review the rule, issued recently by the Ministry of Shipping (MoS), relating to the Bangladesh Flag Vessels (protection of interest) Act 2019 - to avert any interruption in the country's trade and supply chains.
There is a chaos in the shipping sector in recent period over issuing waiver certificate for the foreign flag carriers.
The MoS issued the rule to facilitate the Act of 2019, which created hassles for overseas shipping firms, as they need to convince a few trade-bodies or organisations to get "waiver certificate".
Foreign vessels handle around 90 per cent of the country's external trade.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Faruk Hassan wrote a letter to the MoS on 02 March, requesting it to review the matter.
The trade-body said there would be severe impediments in movement of local garment exports, if the foreign feeder operators are flushed out under the Act, or if they withdraw their Bangladesh coverage.
The BGMEA letter noted that under the foregoing circumstances, the requirement of waiver certificate has no rationale, as Bangladeshi flag vessels' carrying capacity is hardly 9.0 per cent of the total. It clearly implies that the country's 91 per cent trade is dependent on foreign feeder vessels.
Bangladeshi flag carriers must be more proactive and come out of the mind-frame of statutory protection umbrella to face open competition with foreign flag carriers with a more business-like approach.
"This will strengthen the hands of the BGMEA to solicit support from the buyers for the Bangladeshi flag carriers."
It mentioned the case of FOB (free on board) of FCA (free carriers) terms of contracts/LCs, where the buyers concerned in 99 per cent cases are paying for freights, and nominating shipping lines.
"This (the new rule) will cause a major setback in their business policy. Rather, the Bangladeshi ship owners should venture to secure the buyers' nominations."
The BGMEA also mentioned that the total number of containers, handled in Bangladesh in 2022, was around 3.0 million TEUs (20-foot equivalent units), with 1.6 million TEUs of import cargoes and the rest export cargoes.