Under the proposed mode of financial transaction, Bangladeshi exporters have to keep their goods at Amazon warehouses in the USA
Amazon, an American e-commerce giant, yesterday formally wanted to source goods from Bangladesh for its global buyers with flexible terms that will require amending a number of regulations on external trade including the foreign exchange regulations.
In making the sourcing process easier as desired by Amazon, it called for liberalizing the country’s foreign exchange regulations and customs policy so that local exporters can sell their products to global clients using the Amazon platform through a unique mode of transaction.
Gagan Deep Sagor, Category Manager, International Expansion of Amazon, made the request at a meeting with the State Minister for Information and Communication Technology (ICT) at his office at the secretariat.
Under the proposed mode of financial transaction, Bangladeshi exporters have to keep their goods at Amazon warehouses in the USA. After any product is sold out, Bangladeshi exporters will get the prices from Amazon, after adjusting commission.
However, there exists no such provision in the current foreign exchange regulations, or customs laws, says a senior Bangladesh Bank official.
Palak said the Amazon proposed financial transaction would be a boon for small exporters.
“Usually exports are done by big companies, as small entrepreneurs in most cases cannot enter into the export market as they do not have buyers for their products and lack capacity to open Letters of Credit (LCc) ,” Zunaid Ahmed Palak told reporters after the meeting.
Information Technology (IT) entrepreneurs brought a breakthrough to this end by creating online market place, he added.
“We are thinking of creating opportunity for small manufacturers through accessing the global markets using online platform.”
In the meeting, Amazon representative urged the junior minister to make friendly policies so that small entrepreneurs can enter the global markets, particularly the consumers of the US and the Europe through Amazon platform, it was learned.
“In the existing system, it is difficult for a small entrepreneur to sell products directly to buyers. To make it happen, there is a need to bring changes in the current customs policy and foreign currency transaction guidelines, “said Zunaid.
“We are thinking to bring small entrepreneurs under the export regime through a different business model, which ultimately would diversify our exports,” he added.
Zunaid said they wanted Amazon to inform them about the regulations under which the online giant has been doing business in India.
“After knowing India’s regulations on the particular issue, we will study that deeply and consult local stakeholders before recommending any changes in regulations, “said Zunaid.
The junior minister hoped the country’s exports could be doubled, if opportunity was created for small entrepreneurs.
“The Amazon encourages manufacturers to sell products directly on amazon.com as it intends to pay more to producers,” said Mahfuzur Rahman, CEO and Founder of Tech Rajshahi. Mahfuz is coordinating this issue here for Amazon.
Elaborating, he said if a manufacturer made profit to the tune $0.2 through selling a product for $4.20 to a brand, his profit would be multiplied if he directly sold the same item to buyers through Amazon platform.
In the meeting, issues relating to foreign exchange policy and banking payment system were discussed to ensure direct selling through virtual platform, said Rahman.
The meeting also discussed how the government and Amazon can work together on creating workforce and knowledge among the makers, he added.