International Trade & Foreign Exchange-Ebook

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• Publisher ‏ : ‎ Md Makhluk Hasan; 2nd edition (April 11, 2022)
• Publication date ‏ : ‎ April 11, 2019
• Language ‏ : ‎ English

International Trade & Foreign Exchange-EBook

BOOK CONTENTS

Module :: One: An overview of Foreign Trade. 15

Syllabus: 15

Question:: 01.01 : What is foreign Trade or International Trade?. 15

Question:: 01.02: What Types of Foreign Trade ?. 17

Question::01.03: What are the reasons against foreign Trade?. 17

Question::01.04: What are the Importance of International Business for economy?. 19

Question::01.05: What are the key differences between domestic and International Business?. 20

Question:: 01.06: Discuss the problems or limitations of foreign trade or International in Bangladesh. 22

Question:: 01.07: Discuss the Characteristics of foreign trade or International Trade  in Bangladesh. 24

Question:: 01.08: Discuss documents used in Foreign Trade of Bangladesh. 25

Question:: 01. 09 :  Mentioned the Common Import and Export Documents are used In International Trade?  27

Question::01.10 :  Discuss the process of import goods in Bangladesh?. 36

Question::01.11 : What types of credit facilities are provided by the banks to the exporters in Bangladesh?  48

Question::01.12: Discuss an Overview of International Trade and Foreign Exchange. 51

Question::13: Discuss the factors influencing Foreign Direct Investment in a country like Bangladesh. 57

Question:: 01.14:  What do you know about Balance of Trade and Balance of payment ?. 63

Question::01.15: Discuss the Major components of the balance of payment (BOP). 65

Question:: 01.16:  What do you know about  Asian Clearing Union (ACU)?. 66

Question::01.17: What is WTO?  Describe the objective and operation of  world trade organization(WTO)?  69

Question:: 01.18: What are the main function of world trade organization (WTO)?. 71

Question:: 01.19: What are Role and Functions of WTO in Free International Trade ?. 71

Question:: 01.20: What Is the North American Free Trade Agreement?. 74

Question:: 01.21: What Is the effect of North American Free Trade Agreement?. 76

Question::01.22: What Is the goals of North American Free Trade Agreement?. 77

Question:: 01.23 : What do you know of The European Union (EU)?. 77

Question:: 01.24: What do you know about Latin American Free Trade Association (LAFTA)?. 80

Question:: 01.25: Discuss the inco-terms which are used in the International Trade. 81

Question:01.26: Briefly describe the types of credit facilities offered by the banks for financing imports into Bangladesh. What are the precautions to be taken by the banks to avert the risks associated with import financing . 83

Question:01.27: What is meant by Generalized System of Preferences (GSP)? Describe the reason for which the USA has held this facility for Bangladesh. 88

Question::01.28 : Discuss the objective and Implementation strategy to achieve the objectives & goals of the export policy of Bangladesh in the International Trade. 91

Question::01.29: What are the objective of Exchange control of Bangladesh?. 101

Question:: 01.30 : Discuss the objective of the import policy of Bangladesh in the International Trade. 103

Question:: 01.31 : What documents required to open BB L/C?. 106

Question:01.32. What is Bonded ware house?. 106

Question: 01.33. What is Pre-shipment Investment?. 107

Question:01.34. What do you mean by OD Sight, TT Doc, TT Clean and BC Selling exchange. 108

Question:01.35. State all Incoterms with full meaning. 109

Question:: 01.36. Name the different types of Transport document. 110

Question:: 01.37. What is complying presentation?. 110

Question:: 01.38. What are the different types of risks in international trade?. 110

Module –B: General International Organization Knowledge. 113

Question::02.01: What is world bank? Discuss the objectives and function of the world Bank?. 113

Question :: 02.02: What do you know about IBRD?. 115

Question::02.03 : Discuss briefly about IDA?. 118

Question::02.04 : What do you know about IFC ?. 119

Question ::02.05: What do you know about ADB?. 120

Question ::02.06: What do you know about IDB?. 122

Question::02.07: What is the IMF’s mission and how has that changed over time?. 124

Question::02.08:  What is the current relationship between the IMF and World Bank How has that changed over time ? Do their functions overlap?. 125

Question::02.09:  What is the IMF and World Bank’s relationship to the World Trade Organization (WTO) ?  125

Question::02.10:  How does the IMF set its policies?. 125

Question::02.11: How open is the IMF to outside scrutiny and participation?. 126

Question::02.12:  Given that the U.S. taxpayer kicks in a great deal for the IMF,what kind of oversight of the IMF is provided by Congress or other agencies?. 126

Question::02.13:  What is structural adjustment?. 126

Question::02.14:  How do multinational corporations benefit from IMF policies?. 127

Question::02.15:  What is the IMF’s approach to helping countries that are deeply in debt.?. 127

Module C: Role of Banks in Foreign Trade. 129

Question:: 03.01: What is letter of credit (LC)? What Types of Letter of credit?. 129

Question:: 03.02: How Many Parties are involved in Letter of Credit (L/C). 131

Question:: 03.03 : What is the difference Between Letter of Credit and Bank Guarantee. 133

Question:: 03.04: What is the difference Between a Documentary Credit and a documentary collection?  136

Question:: 03.05: Describe briefly the roles of various parties usually involved in a letter of credit?        (Exam Q-2) (IT&FE July 2019)  137

Question::03.07: Describe the rights and obligations of LC issuing banks and Negotiating Banks under the Documentary a letter of credit? What do you understand by the well-known principal that” Banks deals in documents and not in goods” under the Documentary credits?. 145

Question::03.08: Define a letter of credit? What are the rights and responsibilities of the following parties in a Documentary letter credit?. 147

Question: 03.09: Briefly describe the roles of the following banks in documentary letter of credit?. 148

Question::03.10: Define a letter of credit? What are the rights and responsibilities of the following parties in a Documentary letter credit?                                                      (IT&FE December-2015). 153

Question::03.11:What is documentary letter of credit? Does a documentary letter of credit  opened by an importer through his banker in Bangladesh ensure that he will get the exact quantity or right quality of the goods for which the letter of credit is opened? What steps can an importer take if the goods actually received do not meet the descriptions given in the letter of credit or the contract between the importer and exporter  [Exam Q-2]             (IT&FE December-2014). 157

Question::03.12: Briefly discuss the important feature of a documentary letter of credit? Discuss the rights and obligations of the confirming bank under a documentary credit?                 [Exam Q-2]            (IT&FE December-2014)  159

Question::03.13: Explain the term ” Banks deals in documents and not in goods” as per UCPDC?     (Exam Q-2)   (IT& FE July 2019)  160

Question:03.14: Briefly describe the types of credit facilities offered by the banks for financing imports into Bangladesh. What are the precautions to be taken by the banks to avert the risks associated with import financing.   (Exam Q-5) (IT& FE July- 2019). 161

Answer: Types of Import Financing Program Offered by Different Commercial Banks: 161

Question: 03.15:What is meant by Generalized System of Preferences (GSP)? Describe the reason for which the USA has held this facility for Bangladesh. 166

(Exam Q-6) (IT& FE July- 2019). 166

Question:03.16:What is Export Development Fund (EDF) ? What are the criteria for lending money from this funds?(Exam Q-7) (IT& FE July- 2019). 168

Question:03.17: Describe the ways black money in transferred from Bangladesh. What would be your suggestions to check the illegal flow of money from Bangladesh?………………………… (Exam Q-8) (IT& FE July- 2019). 170

Question::03:18: What are the factors responsible for appreciation or depreciation of a currency? Do you think a further depreciation of Bangladeshi taka will be beneficial for the country’s economy?( Exam Q-2)  (IT& FE Nov-Dec- 2018)  170

Question:03.19: Describe in your own words, Main features of a documentary letter of credit. What are the discrepancies ordinarily found in the bills of lading and commercial invoices submitted by the exporter to your bank for negotiation?                        ( Exam Q-3) (IT& FE Nov-Dec- 2018). 172

Question :03.20: What is a Standby Letter of Credit (SLOC) and Why such credits are Used? Distinguish between standby letter of credit and ordinary documentary credit………………………………………..      (IT& FE July- 2018). 174

Question:03.21: Briefly discuss the types of credit facilities offered by the banks to the clients engaged import trade. Identify the risks associated with the import financing and the ways these risks can be minimized.  (IT& FE November- 2017), (IT& FE November- 2011),(IT& FE December- 2013). 178

Question :03.22: What does a non-documentary condition mean?. 183

Question:03.23:How does a transferable letter of credit operate? Describe the obligation and rights of negotiating bank under this type of credit?   (IT& FE November – 2017). 187

Question: 03.24: What are the factor responsible for the flight of capital from Bangladesh? Describe the channels through which the transfer of money take place.  What are the steps that can be taken to reduce the flow of money out of Bangladesh?                 ( Exam Q-5) (IT& FE November – 2018). 188

Question:03.25: What are the main features of  Uniform Rules for Collections(ICC Publication No. URC 522)  192

Uniform Customs and Practice for Documentary Credits, UCP 600. 198

Question:: 03.26: What are the main features of  UCPDC 600. 198

Question:: 03.27:Which documents are used in International Trade?. 204

Question:: 03.28: What is foreign correspondent relationship and accounting relationship in International Trade?  217

Answer: Foreign Correspondent: 217

Question:: 03.29: Discuss about notro account reconciliation. 220

MODULE-D.. 222

Protection against Risk in Foreign Trade. 222

Question:: 04.01: Discuss the risk associated with International Trade. 222

Question::04.02: Discuss the fraud under standby letter of credit. 224

Question:: 04.03: Discuss the Export Credit Guarantee Schemes in Bangladesh. 224

Question:: 04.04: What is Foreign exchange risk? Discuss the ways of overcoming exchange risk?. 229

Question:: 04.05: What do you know about political risk?. 230

Question:: 04.06: Discuss about Operational and legal risk management relating to settlement ?. 231

MODULE-E. 233

Exchange Control Regulations. 233

Question :: 05. 01: Briefly  discuss about the Foreign Exchange Regulation Act, 1947 [11th March, 1947]  233

Question:: 05.02:  What do you know about Foreign Exchange Regulations regarding Forex operation by Authorised Foreign Exchange Dealers?. 235

Question:: 05.03: What are the Objectives of Foreign Exchange Regulation Act 1947?. 236

Question:05.04: Discuss The Foreign Exchange Regulations In Bangladesh.   (IT & FE Nov 2017). 236

Question:: 05.05: Asia Pacific Group on Money Laundering (APG). 237

Question:: 05.06: What is Shell Companies  ?. 238

Question::05.07: What is Money Laundering?. 238

Question:: 05.08: What Is Terrorist Financing?. 240

Question:: 05.09:Briefly describe the types of credit facilities offered by the banks for financing imports into Bangladesh. What are the precautions to be taken by the banks to avert the risks associated with import financing. 242

(Exam Q-5) (IT& FE July- 2019). 242

Question::05.10: What are the stages of Money Laundering?. 247

Question::05.11: What is factoring of Money Laundering?. 249

Question::05.12:What role does a correspondent bank play in an international transaction?. 250

Question::05.13: Briefly discuss about BEPZ. 251

Question::05.14: What is Foreign Direct Investment (FDI)?. 256

Question::05.15: What is the current FDI in Bangladesh?. 256

Question::05.16: What is the impact of FDI in Balance of payment in Bangladesh?. 257

Question::05.17: How to improve FDI flow in Bangladesh?. 258

Module F: Exchange Rates. 261

Question::06.01: What Kind Of Exchange Rate System Is Followed In Bangladesh?. 261

Question::06.02: Discuss the Currency Regulations for Travelers / Passengers of Bangladesh. 263

Question:: 06.03: Discuss the Foreign Exchange Market in Bangladesh. 264

Question: :06.04: What kind of exchange rate system is followed in Bangladesh? Or,What kind of exchange rate policy is being currently followed by the authorities in Bangladesh? (IT & FE Nov 2017). 268

Question:: 06.05: Which Factor are Affecting Fluctuation in Exchange Rates?. 269

Question:: 06.06: What are the Objectives of Foreign Exchange RegulationAct 1947?. 270

Question:: 06.07: What are the Meaning Of Foreign Exchange Rates?. 271

Question::06.08: Discuss determination Of Foreign Exchange Rate. 271

Question:: 06.09: What are the Demand for Foreign Exchange?. 272

Question:: 06.10: What do you understand by the Supply of Foreign Exchange?. 272

Question:: 06.11: What are the equilibrium Foreign Exchange Rate?. 273

Question::06.12 : What are the Exchange Rate System of Bangladesh?. 273

Question::06.13: What are the factors that influence our floating exchange rate?. 276

Question::06.14: Discuss about Foreign Remittance and it’s Procedure?. 277

Question::06.15: Discuss the various Exchange Rate in Foreign Exchange business?. 280

The rate of exchange between two currencies is quoted in two ways : 280

Question:: 06.16: What is offshore banking? How does it function?. 283

Question::06.17: What is exchange position? How does it work?. 285

Question:: 06.18:Discuss the different financial instruments used in international payment settlement. 287

Module – G : Foreign Exchange Markets. 288

Question::07:01: Discuss the Foreign Exchange Market in Bangladesh. 288

Question::07. 02: Discuss the open market operating methodology of Bangladesh bank. 292

Question:: 07. 03 : Discuss about Foreign Exchange Market and its Important Functions. 298

Question:07.04: Describe the main features of foreign exchange market in Bangladesh. Offer your suggestions to make the market more meaningful to meet the needs of the banks and clients for both spot and forward transactions. Nov 2017. 301

Question:: 07.05: Discuss about The Swap Market. 306

Question:: 07.06: Discuss about Euro as a new currency. 316

Question::07.07: Discuss the purpose of exchange control and methods of applying control on foreign exchange transactions by the central bank of Bangladesh. Do you think exchange control is still necessary in view of the realization of exchange rates of taka and satisfactory level of foreign exchange reserve?. 317

Question::08.01: What is meant by foreign exchange Transaction?. 320

Types of Foreign Exchange Transactions. 320

Question:: 08.02: What are the various method of payment that are used for settlement of payments for international trade?. 322

Key Points. 322

Cash-in-Advance. 323

Letters of Credit 323

Documentary Collections. 323

Open Account 323

Consignment 324

Question::08.03: What is offshore banking? How does it function?. 324

Question::08.04: What is exchange position? How does it work?. 329

Question:: 08.05 : Discuss the different financial instruments used in international payment settlement. 331

Question::08:06: What role does a correspondent bank play in an international transaction?. 332

Module I: Financing of Foreign Trade in Bangladesh. 333

Question::09.01: What is the meaning of foreign trade?. 333

Question:09. 02 : What are the different types of risks in international Trade or foreign trade? How to mitigate risks in International Trade?. 333

Question::09.03: Discuss the Risk in Foreign Exchange Business. 333

Question::09. 04: What is under invoicing and over invoicing? What are the impact of under invoicing and over invoicing? What steps has Bangladesh taken to check such evil effects?. 337

Question:: 09.05: What is meant by inco-terms in international trade? Discuss the importance of such terms? What types of inco-terms are used in Bangladesh? How does bank provide finance to importers in import trade?. 342

Question::09:6: What is GSP? What steps are to be followed for ensuring GSP facility? What documents are needed for GSP facilities? What facilities are provided for the least developed countries under the scheme?. 345

Question::09.07: What do you meant by EPZ? State the features and objectives of EPZ? Mentioned the incentives that Bangladesh Government provides for establishing industries at EPZ? Are this incentives sufficient for attracting the foreign investors?. 345

EPZ-A New Horizon for Investors. 345

Question::09.08: Make a brief discussion on the export market of Bangladesh. What steps should be taken for the expansion of this market?. 349

Question::09.09: Discuss the methods followed for the control of export trade in Bangladesh. Is the EXP system introduced by Bangladesh Bank adequate for this purpose? If not, suggest necessary measures?. 349

Question: 09.10: Discuss the methods for collecting export earnings. What cares should an exporter take in bringing export earnings into his country?. 349

Question:: 09.11:Why does the need for control of import trade arise? Discuss the roles of controlling import trade in Bangladesh?. 349

Question::09.12: What is Post import credit? Discuss the procedure of post-shipment credit? What types of risk involve in such credit?. 350

Question:: 09:13: What are the factors responsible for flight of capital from Bangladesh? Describe the channels through which the transfer of money take place. What are the steps that can be taken, to reduce the flow of money out of Bangladesh? [Exam Question-5 ] (IT &FE November- December, 2018). 350

Question::09.14: Discuss the causes for transfer money from Bangladesh to foreign countries?. 359

What the authorities can do steps the leakage of foreign exchange on this account  [Exam Question-6 ] (IT &FE July, 2018). 359

Question::09.15: Why is Trade Miss invoicing Used?. 364

Question: :09.16: Explain the importance of pre-shipment export credits to promote export from Bangladesh. Briefly discuss the types of preshipment export credits provided by Banks in Bangladesh. [Exam Question-6 ] (IT &FE November- December, 2018). 364

What types of credit facilities are provided by the banks to the exporters in Bangladesh?. 365

Question:: 09.17: Describe briefly the financial and none financial services provided to the exporter by the banking system of Bangladesh. [Exam Question-4 ] (IT &FE November, 2016). 368

Question::09.18: Describe the various financial market in Bangladesh. 371

Question::09.19 : Discuss the Problems of Import Financing in Bangladesh. 372

Question::09. 20 : Discuss about Cash Incentives to increase export and to establish the backward linkage. 375

Question:: 09: 21: Discuss about Exporters’ Retention Quota (ERQ) Account. 379

Module-J : Exchange Arithmetic. 384

Short Note:: 11.01: Quasi Negotiable Instruments. 412

Short Note:: 11.02: Why bill of lading is not a negotiable instrument?. 412

Short Note:: 11.03: What are the Effect of the Transfer of a Bill of Lading?. 412

Short Note:: 11.04: Received for Shipment Bill of Lading: 413

Short Note:: 11.05 : Ship’s Delivery Order: 413

Short Note:: 11.06: Loan against Imported Merchandise (LIM). 414

Short Note:: 11.07 : Bill of Exchange: 414

Short Note:: 11.08: International Monetary Fund (IMF): 415

Short Note:: 11.09:Convertibility of Taka: 416

Short Note:: 11.10 :OFFICIAL RESERVE ACCOUNT: 417

Short Note:: 11.11: Convertibility: 417

Short Note:: 11.12:COMMERCIAL REMITTANCES: 418

Short Note:: 11.13: CONVERTIBILITY ON TRADE ACCOUNT: 418

Short Note:: 11.14: EXCHANGE FACILITIES  FOR EXPORTERS: 418

Short Note:: 11.15 :FOREIGN CURRENCY ACCOUNTS : 419

Short Note:: 11.16 :MISCELLANEOUS  REMITTANCES: 420

Short Note:: 11.17 :Money changer : 420

Short Note:: 11.18 :What is floating exchange rate: 420

Short Note:: 11.19 : A fixed exchange rate: 420

Short Note:: 11.20 :Proforma invoice: 421

Short Note:: 11.21 :Discuss the inco-terms which are used in the International Trade. 421

Short Note:: 11.22 : Red clause Letter of credit: 424

Short Note:: 11.23 : Confirmed Irrevocable Documentary Credit: 424

Short Note:: 11.23 :Revolving Documentary Credit: 424

Short Note:: 11.24 : Transferable Documentary Credit: 424

Short Note:: 11.25 :Back-to-Back Documentary Credit: 424

Short Note:: 11.26 : Stale bill of lading: 424

Short Note:: 11.27 : Charter Party Bill of Lading (CPBOL): 425

Short Note:: 11.28 : The Bill of lading : 425

Short Note:: 11.29 : World trade organization (WTO): 426

Short Note:: 11.30 : Straight Bill of Lading (SBOL): 426

Short Note:: 11.31 : North American Free Trade Agreement(NAFTA): 427

Short Note:: 11.32 : The European Union: 429

Short Note:: 11.33 : Reimbursing Bank: 429

Short Note:: 11.34 : What you know about SWIFT: 430

Short Note:: 11.35 : The International Development Association (IDA): 431

Short Note:: 11.36 : Export Development Fund (EDF) : 431

Short Note:: 11.37 : Cross Rate: 432

Short Note:: 11.38 : Combined Bill of Lading: 433

Short Note:: 11.39 Bill of Entry: 433

Short Note:: 11.40 : Consular Invoice: 433

Short Note:: 11.41 :Dhaka inter-bank offer rate (DIBOR): 434

Short Note:: 11.42: Brexit. 434

Short Note:: 11.43: The Asian Development Bank (ADB) : 435

Short Note:: 11.44: Convertibility of Taka: 435

Short Note:: 11.45 : The Asian Development Bank (ADB) : 437

Short Note:: 11.46: Combined bill of lading? How does combined bill of lading work?. 438

Short Note:: 11.47: Forced Lim: 439

Short Note:: 11.48: What is PAD?. 439

Short Note:: 11.49:Forced Lim: 441

Short Note:: 11.50 :What is LTR?. 443

Short Note:: 11.51: Balance of Trade and The Balance of Payments. 443

Short Note:: 11.52: Balance of Trade. 444

Short Note:: 11.53: Balance of Payments: 445

Short Note:: 11.54 : Balance of Payments and Balance of Trade. 448

Short Note:: 11.55: NEGOTIATION OF EXPORT BILL. 448

Short Note:: 11.56: What is lodgement ?. 452

IMPORT PROCEDURE.. 461

Import and Export Financing. 461

Short Note:: 11.57: FOREIGN EXCHANGE RATE: 462

Short Note:: 11.58 : FOREIGN EXCHANGE RESERVE: 462

Short Note:: 11.59: FOREIGN EXCHANGE CONTROL: 462

Short Note:: 11.60: FOREIGN EXCHANGE MARKET: 463

Short Note:: 11.61 : EXCHANGE RATE QUOTATION: 463

Short Note:: 11.62: EXCHANGE  RATE MANAGEMENT. 464

Floating. 464

Short Note:: 11.63: OPERATIONAL EXCHANGE RATE. 466

Short Note:: 11.64: Euro – A NEW CURRENCY. 469

Short Note:: 11.65: EPZ-A New Horizon for Investors. 470

Short Note:: 11.66: DEALING ROOM OPERATIONS. 477

Short Note:: 11.67: Purchase of Foreign Bills under D/P and D/A bills: 479

Short Note:: 11.68: IMPORT FINANCING: 480

Short Note:: 11.69:EXPORT FINANCING: 481

Short Note:: 11.70:Documentary collection: 483

Short Note:: 11.71: 485

Letters of Credit vs Documentary Collection in International Business Transactions. 485

Letters of Credit in a Nutshell 485

Documentary Collection in a Nutshell 485

When to Use Letters of Credit vs. Documentary Collection. 485

Short Note:: 11.72: 486

Negotiation under reserve. 486

Short Note:: 11.73: 487

Suppliers credit : 487

Short Note:: 11.74: 488

Exporters’ Retention Quota (ERQ). 488

Short Note:: 11.75: 489

Generalized System of Preferences (GSP): 489

Short Note:: 11.76: 490

What Is a Claused Bill of Lading?. 490

Short Note:: 11.77: 490

What is Money Laundering?. 490

Short Note:: 11.78:Authorised dealer in Foreign Exchange: 490

Short Note:: 11.79:Documents Against Payment : 491

Short Note:: 11.80:The gold standard : 492

Short Note:: 11.81:Export Policy Bangladesh. 494

Export Policy – Implementation strategy. 495

Short Note:: 11.82:Open position : 496

Short Note:: 11.83:International trade : 496

Short Note:: 11.84:of International Trade. 497

Short Note:: 11.85:Meaning is International Trade. 498

Short Note:: 11.86: Advantages of International Trade. 498

Short Note:: 11.87:Disadvantages of International Trade. 499

Short Note:: 11.88:Financial Derivatives: 500

Short Note:: 11.89: Advantages of Derivatives. 501

Short Note:: 11.90:Disadvantages of Derivatives. 502

Short Note:: 11.91: Value date on foreign trade. 503

Short Note:: 11.92:What Is Offshore?. 504

Short Note:: 11.93: Received for Shipment Bill of Lading. 504

Short Note:: 11.94: Received for shipment B/L. 504

Short Note:: 11.95: A correspondent bank : 505

Short Note:: 11.96: Documentary frauds in foreign trade : 506

Short Note:: 11.97: Functions of Treasury Front Office: 508

Short Note:: 11.98: Functions of Treasury Mid Office: 508

Short Note:: 11.99: Functions of Treasury Back Office: 508

Short Note:: 11.100: Deal Slip: 509

Short Note:: 11.101: Counterparty Limits: 509

Short Note:: 11.102: Triggers: 510

Short Note:: 11.103: Stop Loss Orders: 510

Short Note:: 11.104: Dealing Limits: 510

Short Note:: 11.105: The key risk areas of a financial institution: 511

Short Note:: 11.106: Market Risk. 512

Short Note:: 11.107: Liquidity Risk. 513

Short Note:: 11.108: Compliance Risk. 513

The following indicators should be used when assessing the quality of compliance risk management: 514

Short Note:: 11.109 : Reputational and Fraud Risk. 515

Short Note:: 11.110: Credit Risk. 515

Short Note:: 11.111: Operational Risk. 515

Short Note:: 11.112: Operational and legal risk management relating to settlement: 516

Short Note:: 11.113: Pre-settlement risk: 516

Short Note:: 11.114: Spot Foreign Exchange. 517

Short Note:: 11.115: Forward Foreign Exchange. 517

Short Note:: 11.116: Forex Options. 517

Short Note:: 11.117: Forex Swaps. 518

Short Note:: 11.118: Cross Currency Swaps. 519

Short Note:: 11.119: Interest Rate Swaps. 520

Short Note:: 11.120: Interest Rate Cap and Collar. 521

Short Note:: 11.121:Restrictions on dealing in Foreign Exchange. 521

Short Note:: 11.122: Foreign Exchange Regulation Act 1947. 522

Short Note:: 11.123: Exchange Rate Management System.. 524

Short Note:: 11.124: Full and Partial Convertibility. 525

Short Note:: 11.125: Precondition for Implementation of Convertibility. 525

Short Note:: 11.126 :Methods of International Payment. 525

Short Note:: 11.127: Import Process. 527

Short Note:: 11.128: Import Finance. 528

Short Note:: 11.129: Procedure for Obtaining Export Registration Certificate (ERC). 529

Short Note:: 11.130 : Export Financing. 529

Post Shipment Credit. 532

Short Note:: 11.131: Export Promotion Bureau (EPB): 532

Short Note:: 11.132 : Cash Incentives. 532

Short Note:: 11.133: Limit of Export Credit. 533

Short Note:: 11.134: Export Development Fund. 533

Short Note:: 11.135: Export Credit Guarantee Scheme. 533

Short Note:: 11.136 : Regulation on Exports from Bangladesh. 534

Short Note:: 11.137: Controls on Exports from Bangladesh. 535

Short Note:: 11.138 :Export Claims. 536

Short Note:: 11.139: Capital Account Convertibility. 536

Short Note:: 11.140: Cash Incentives. 537

Short Note :: 11.141: Exporters’ Retention Quota (ERQ) Account. 538

Short Note:: 11:142: Commercially Important Persons (CIP). 539

Short Note::11: 143:Bonded Warehouse Facility: 540

Short Note :: 11: 144: Discounting a Bill of Exchange. 541

Short Note :: 11: 145 :Advantages for the Seller in D/P and D/A Transactions. 541

Short Note :: 11: 146: Recourse for Dishonored Bills of Exchange. 542

Short Note :: 11: 147: DEFINITION OF FOREIGN EXCHANGE. 542

Short Note :: 11: 148: Airway bill / Air consignment note. 542

Short Note :: 11: 149: REPO (Repurchase agreement). 544

Short Note :: 11: 150: Advantages and disadvantages of financing imports under LTR. 547

Short Note :: 11: 151: The International Development Association (IDA). 548

Briefly distinguish between the following terms: 553

Briefly distinguish between the following terms: 559

Comparison Chart 560

Briefly distinguish between the following terms: 565

Comparison Chart 566

Foreign exchange quotes. 568

Difference between Letters of Credit vs. Documentary Collection. 569