Burma and Bangladesh have started to do business on letter of credit (L/C) terms in the countries' efforts to boost bilateral trade.

The move comes after the two countries reached an agreement to make L/Cs available through Bangladesh's Sonali Bank (DC World News, 16 January 2012).

Two L/Cs

According to reports from Bangladesh, Burmese entrepreneurs have opened two L/Cs with state-owned Sonali Bank's branch at Teknaf on the Bangladeshi-Burmese border.

A Sonali Bank official announced the L/C deals at a meeting at Bangladesh's ministry of commerce.

Clearing union

The bank official said the L/C transactions had been organised within the mechanisms of the Asian Clearing Union (ACU).

Before these latest transactions, L/Cs between the two countries under the ACU mechanism were settled through third-country banks.

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