Daily News Flash: 4th May 2020

Contents
GLOBAL NEWS ................................................................................................................................... 1
DOLLAR UP, ASIAN STOCKS SLIP AS U.S. PINS BLAME FOR VIRUS ON CHINA ......................................... 1
OIL PRICES FALL ON DEMAND CONCERNS, U.S.-CHINA TRADE TENSION ............................................... 1
PANDEMIC SLAMS ASIA'S FACTORIES, ACTIVITY HITS FINANCIAL CRISIS LOWS ..................................... 1
TRUMP ADMINISTRATION PUSHING TO RIP GLOBAL SUPPLY CHAINS FROM CHINA: OFFICIALS ............ 1
MACRO ECONOMY ........................................................................................................................... 2
DEBT RELIEF OF TK2,700 CRORE FOR BANGLADESH ............................................................................. 2
APRIL REMITTANCE DIPS TO 2.5-YR LOW TO $1.08B ............................................................................ 2
BB CONFISCATES BANKS’ INTEREST INCOME FOR APR, MAY ................................................................ 2
FY21 BUDGET COMING IN JUNE: FINANCE MINISTRY ........................................................................... 2
FACTORIES OPEN IN PORT CITY WITH LAX HEALTH AND SAFETY MEASURES ........................................ 3
NEXT BUDGET COULD EYE 6.0PC GDP GROWTH RATE .......................................................................... 3
NBR TO CHASE TK 3.3TN TAX TARGET IN NEXT FY ................................................................................ 3
BANKS START DISBURSING WORKER WAGES ....................................................................................... 3
TEXTILE............................................................................................................................................... 4
RMG EXPORT IN APRIL PLUNGES BY 85PC ............................................................................................ 4
GOVT MULLS ISOLATING THREE RMG CLUSTERS .................................................................................. 4
CAPITAL MARKET ............................................................................................................................ 4
DSE TO SEEK PERMISSION FROM BSEC TODAY ..................................................................................... 4
MOST MNCS DECLARE HEFTY DIV DESPITE BEARISH MARKET .............................................................. 4
GLOBAL NEWS

DOLLAR UP, ASIAN STOCKS SLIP AS U.S. PINS BLAME FOR VIRUS ON CHINA
 The dollar inched higher, stock markets struggled for traction and oil dropped on Monday as a
U.S.-China spat over the origin of the coronavirus put the brakes on optimism about an
economic re-start as countries around the world ease restrictions.
 In thinned trade, with China and Japan on holiday, U.S. stock futures were last down 0.7%. FTSE
futures fell 0.6% and European shares seemed set to return from a May Day break with a slump.
EuroSTOXX 50 futures fell 3%.
 U.S. crude snapped three sessions of gains with a 6% drop and the safe-haven U.S. dollar rallied
to one-week highs against the risk sensitive Australian and New Zealand dollars.
Source: https://www.reuters.com/article/us-global-markets/dollar-up-asian-stocks-slip-as-u-s-pins-blame-for-virus-on-china-
idUSKBN22G003

OIL PRICES FALL ON DEMAND CONCERNS, U.S.-CHINA TRADE TENSION

 Oil prices fell on Monday, paring last week’s gains, on worries a global oil glut may persist amid
slumping demand and U.S.-China trade tensions that could restrict an economic recovery even
as coronavirus pandemic lockdowns start to ease.
 U.S. West Texas Intermediate (WTI) crude CLc1 futures fell as low as $18.10 a barrel earlier in
the session and were down $1.01, or 5.1%, at $18.77 at 0658 GMT. The benchmark contract
rose 17% last week.
 Brent crude LCOc1 futures were down 10 cents, or 0.4%, at $26.34, after touching a low of
$25.50. Brent rose about 23% last week following three consecutive weeks of losses.
Source: https://www.reuters.com/article/us-global-oil/oil-prices-fall-on-demand-concerns-u-s-china-trade-tension-
idUSKBN22F0XA

PANDEMIC SLAMS ASIA'S FACTORIES, ACTIVITY HITS FINANCIAL CRISIS LOWS

 Asia’s factory activity was ravaged in April, business surveys showed on Monday, and the
outlook dimmed further as government restrictions on movement to contain the coronavirus
outbreak froze global production and slashed demand.
 A series of Purchasing Managers’ Indexes (PMIs) from IHS Markit fell deeper into contraction
from March, with some diving to all-time lows and others hitting levels last seen during the
2008-2009 global financial crisis.
 Similar gauges out of Europe due on Monday and later in the week are also expected to show
industry conditions wallowing around record lows, reinforcing the International Monetary
Fund’s warning the global economy is headed for its biggest decline since the 1930s.
Source: https://www.reuters.com/article/us-health-coronavirus-global-economy/pandemic-slams-asias-factories-activity-hits-
financial-crisis-lows-idUSKBN22G0AU

TRUMP ADMINISTRATION PUSHING TO RIP GLOBAL SUPPLY CHAINS FROM CHINA: OFFICIALS
 The Trump administration is “turbocharging” an initiative to remove global industrial supply
chains from China as it weighs new tariffs to punish Beijing for its handling of the coronavirus
outbreak, according to officials familiar with U.S. planning.
 President Donald Trump, who has stepped up recent attacks on China ahead of the Nov. 3 U.S.
presidential election, has long pledged to bring manufacturing back from overseas.
 Now, economic destruction and the massive U.S. coronavirus death toll are driving a
government-wide push to move U.S. production and supply chain dependency away from China,

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 even if it goes to other more friendly nations instead, current and former senior U.S.
administration officials said.
Source: https://www.reuters.com/article/us-health-coronavirus-usa-china/trump-administration-pushing-to-rip-global-supply-
chains-from-china-officials-idUSKBN22G0BZ

MACRO ECONOMY

DEBT RELIEF OF TK2,700 CRORE FOR BANGLADESH

 Bangladesh is eligible for debt relief from G-20 nations as the international forum announced a
year-long moratorium on debt repayment for low-income countries amid the pandemic.
 Economic Relations Department (ERD) and World Bank officials, in Dhaka, said following this
decision – for the next year – Bangladesh and other poor countries will not have to make debt
payments for bilateral loans they have taken from different countries.
 Bangladesh makes repayments of around Tk12,750 crore a year to external creditors. Of the
amount, the country is to repay around $31 crore or Tk2,700 crore with interest in instalments
of bilateral loans
Source: https://tbsnews.net/economy/debt-relief-tk27000-crore-bangladesh-76795

APRIL REMITTANCE DIPS TO 2.5-YR LOW TO $1.08B

 Inflow of remittance dropped to a three-year low to $1.08 billion in April as the global economy
has come to a halt due to the coronavirus pandemic in most of the countries, including the
major destinations where Bangladeshi migrants work.
 Remittance inflow in April of this year was the lowest since May of 2017 when the country
received $1.077 billion in remittance.
 Remittance earnings in April this year was 24.63 per cent or $353.3 million lower than the $1.43-
billion inflow in the same month last year.
Source: https://www.newagebd.net/article/105630/april-remittance-dips-to-25-yr-low-to-108b

BB CONFISCATES BANKS’ INTEREST INCOME FOR APR, MAY

 The central bank yesterday directed banks to transfer all interest accrued or to be accrued
between April 1 and May 31 this year from all of their loans to an interest-free blocked account,
in what can be construed as its boldest move yet amid the pandemic.
 A blocked account refers to an account that does not allow for the indiscriminate withdrawal
but instead has certain restrictions or limitations on when, how much, and by who, capital can
be withdrawn.
 Besides, banks are not allowed to transfer the interest or profits deposited in the blocked
account of the borrowers to lenders' income book until further notice, according to a
Bangladesh Bank notice.
Source: https://www.thedailystar.net/business/news/bb-confiscates-banks-interest-income-apr-may-1899253
Source: https://tbsnews.net/economy/banking/borrowers-need-not-pay-interest-april-may-bb-76675

FY21 BUDGET COMING IN JUNE: FINANCE MINISTRY

 The budget for fiscal 2020-21 will definitely be unveiled in June after the finance ministry
yesterday put all suspense to bed by sending out a press release informing it.
 To make the budget preparation process participatory, the government has sought opinions and
recommendations from all professionals and stakeholders through the finance division's website
www.mof.gov.bd.

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  The government is putting more emphasis on digital platforms to hear the voices of people and
opinions of the experts about the next budget because of the movement control order aimed at
containing the COVID-19.
Source: https://www.thedailystar.net/business/news/fy21-budget-coming-june-finance-ministry-1899250

FACTORIES OPEN IN PORT CITY WITH LAX HEALTH AND SAFETY MEASURES
 With great trepidation and no other choice, about 1.5 lakh workers in Chattogram have joined
their workstation from April 26.
 And the factories, and there are more than 205 of them, have not put in government-directed
health and safety measures to protect them from contracting COVID-19, the workers said.
 They are wearing face masks out of their own sense of self-preservation but the factory owners
are neither providing hand gloves, hand sanitisers, hand washing facilities as per the health and
safety rules nor ensuring social distancing.
Source: https://www.thedailystar.net/business/news/factories-open-port-city-lax-health-and-safety-measures-1899259

NEXT BUDGET COULD EYE 6.0PC GDP GROWTH RATE

 The government is likely to set a 6.0 per cent GDP (gross domestic product) growth target for
the fiscal year, 2020-21, finance ministry officials say.
 The rate is 2.2 per cent lower than the original growth target of 8.2 per cent for the current
fiscal year.
 A senior finance ministry official told the FE on Sunday the country's economic activities have
been battered severely by the prolonged shutdown aimed at slowing the spread of COVID-19,
an illness caused by new coronavirus.
Source: https://today.thefinancialexpress.com.bd/first-page/next-budget-could-eye-60pc-gdp-growth-rate-1588523799

NBR TO CHASE TK 3.3TN TAX TARGET IN NEXT FY

 The government has set a Tk 3.30-trillion revenue collection target for the National Board of
Revenue (NBR) for the fiscal year (FY) 2021.
 The target is 1.35 per cent higher than that of the original goal of Tk 3.25 trillion and almost 10
per cent higher than the revised target set at Tk 3.0 trillion for the current FY.
 The target for value added tax (VAT) collection has been set at Tk 1.28 trillion, followed by
income tax at Tk 1.05 trillion and customs duty at Tk 956.52 billion.
Source: https://today.thefinancialexpress.com.bd/first-page/nbr-to-chase-tk-33tn-tax-target-in-next-fy-1588523732

BANKS START DISBURSING WORKER WAGES

 The country’s banks on Sunday started disbursing wages of more than 26 lakh workers of
export-oriented industries, including apparel ones, as the central bank released Tk 2,000 crore
from Tk 5,000 crore stimulus package announced by the government for the purpose.
 As per the government’s revised decision, the workers who had worked in April would get their
full wages and the workers who did not work would get 60 per cent of their wages.
 BB officials said that the central bank had already released Tk 2,000 crore to the banks from the
government-announced Tk 5,000 crore stimulus package.
Source: https://www.newagebd.net/article/105628/banks-start-disbursing-worker-wages

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TEXTILE

RMG EXPORT IN APRIL PLUNGES BY 85PC

 The country’s readymade garment export plunged by almost 85 per cent year on year in April
this year as the coronavirus outbreak in most of the countries disrupted the global supply chain
and forced the manufacturers to suspend production.
 According to the provisional data prepared by the Bangladesh Garment Manufacturers and
Exporters Association compiling statistics from the National Board of Revenue, the RMG export
in April this year declined by 84.86 per cent to $366.58 million from $2.42 billion in the same
month of 2019.
 According to the Export Promotion Bureau data, the RMG export in March, 2020 declined by
30.19 per cent to $1.97 billion from $2.82 billion in the same month of 2019.
Source: https://www.newagebd.net/article/105629/rmg-export-in-april-plunges-by-85pc

GOVT MULLS ISOLATING THREE RMG CLUSTERS

 The health ministry on Sunday said the readymade garment factories can only be run by
ensuring workers' safety without letting the virus situation worsen.
 The ministry placed a seven-point condition for the garments factory owners in three hotspots
for Covid-19-Dhaka, Narayanganj and Gazipur.
 The conditions include-three zones to be isolated from other parts of the country and no worker
will be allowed to move from one area to another until further notice issued.
Source: https://today.thefinancialexpress.com.bd/last-page/govt-mulls-isolating-three-rmg-clusters-1588524315

CAPITAL MARKET

DSE TO SEEK PERMISSION FROM BSEC TODAY

 Dhaka Stock Exchange (DSE) will seek permission today (Monday) from the securities regulator
to resume trading on May 10.
 The premier bourse DSE will send a letter to the Bangladesh Securities and Exchange
Commission (BSEC) seeking its approval required to resume trading amid the ongoing general
holiday.
 "Our board has already taken the decision of resuming trading and has asked the management
to seek the regulatory permission in this regard," said Md. Shakil Rizvi, a DSE director.
Source: https://today.thefinancialexpress.com.bd/stock-corporate/dse-to-seek-permission-from-bsec-today-1588517338

MOST MNCS DECLARE HEFTY DIV DESPITE BEARISH MARKET

 Most of the listed multinational companies (MNCs) have recommended substantial amount of
cash dividends for the year ended on December 31, 2019, maintaining their profit growth.
 There are eleven MNCs listed on Dhaka Stock Exchange (DSE) which account for approximately
24 per cent of DSE's total market capitalisation.
 Of the listed MNCs, nine declared dividend for the year ended on December 31, 2019, so far as
of Sunday, according to available data with the DSE and the companies' official disclosures.
Source: https://today.thefinancialexpress.com.bd/stock-corporate/most-mncs-declare-hefty-div-despite-bearish-market-
1588517247

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