Ship recyclers in Bangladesh say it is now almost impossible to buy tonnage after the country’s central bank further reduced on Friday the value of letters of credit that can be issued for foreign currency purchases to $3m.

This follows a move by the Bangladesh Bank earlier in July that required central approval for letters of credit over $5m and the suspension of letters of credit over $25m except in exceptional circumstances.

Mohammed Zahirul Islam, managing director of Chattogram-based PHP Shipbreaking & Recycling Industries, told TradeWinds that not only do recyclers face severe challenges from the restriction on letters of credit, they have also been badly hit by a 20% drop in the value of the Bangladeshi taka, which in the early part of this year remained relatively stable at around BTD 86 to the dollar, but has been in a steep...