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.