Types of Industries to be set up in Export Processing Zones

Types of Industries to be set up in Export Processing Zones

Types of Industries to be set up in Export processing zones (EPZ)

Export processing zones (EPZs) are areas within developing countries that offer incentives and a barrier-free environment to promote economic growth by attracting foreign investment for export-oriented production.

Based on the ownership, the factories in the EPZ can be classified into three categories. They are as follows:

Group-A: The industries under foreign ownership fall into this category. The Bangladeshi with the foreign citizenship can also establish them.

Group-B: The industries developed tinder joint ownership by both foreign and local investors tall under this category.

Group-C: The industries under 100% local ownership and investment are in this Category.

Conditions for establishing industries in these three categories in EPZ are as follows:

Conditions for Group-A:

  • Investment must be done with the investors
  • 95% of the export earnings can be sent abroad. The remaining 5% can be sent after tax and other liabilities.

Conditions for Group-B:

  • The expense for the heavy machineries must be bourn by the foreign investor.
  • The foreign investor will pay for all the raw materials.
  • The local capital must be supplied by the investor or by loan.
  • If the profit of the foreign investor is equal to the expenses he has bourn then he can send his part of profit to the abroad.

Conditions for Group-C:

  • The cost of the raw materials, machineries and other imported materials and wages of the foreign workers can be paid through wage earners scheme, export performance licensee etc.
  • The total export license must be given to the Bangladesh Bank.

The types of permitted industries based on the product type:

  • Knit and garment industries ready-made garments, hosiery, knitting and embroidery, carpet, blanket etc.
  • Household Items, household utensils, machineries, and furniture.
  • Sports Items- Sports items, toys and plastic products.
  • Electronics- electronic items and parts.
  • Leather and Shoes industries- Shoes and leather goods.
  • Artificial ornaments and optical items.
  • Medical materials- various types of biological, surgical, and dental machineries.
  • Engineering Industry- various types of engineering materials, scientific measurement machines and measuring scales.
  • Medicine and canned fish.
  • Fruit processing industry.