Contribution of Export Processing Zones in Promoting Export of Bangladesh

The Government of Bangladesh, with a view to encouraging rapid economic development through increased industrial activity and creation of employment opportunities for the people of Bangladesh, is establishing multi-sectoral Economic Zones (EZ). The Government of Bangladesh has enacted the Bangladesh Economic Zones Act of 2010 with the aim of promoting Economic Zones in the Private sector, Government led EZS or in a combination. The government is planning to set up a total of 100 special economic zones in different parts of the country by the year 2030 in a bid to fetch more foreign investment and generate large-scale employment for the country's vast pool of workers.

The economic zones will be set up on 75,000 acres of land under the supervision of Bangladesh Economic Zones Authority (BEZA). Of the proposed 100 economic zones, projects for 22 economic zones have already got approval with two in the private sector.

With establishment of the proposed 100 special economic zones, Bangladesh will be able to attract huge foreign investment and encourage local entrepreneurs to pour fresh funds in new industries.

The government is creating investment-friendly economic zones linking Bangladesh with the free market economy and liberalise trade. It wants private entrepreneurs to get opportunities and to establish and profitably run industrial enterprises. A Bangladesh Economic Zones Authority (BEZA) report shows that the contribution of the industrial sector to the country's economy is on the rise During 1971–80, the contribution of the sector to GDP was 11 per cent. It has increased to 30 per cent in FY 2015-16. Manufacturing sectors like textile and apparel, leather, food and beverage, and Solut pharmaceuticals have contributed to building a vibrant industrial economy. Bangladesh has a lot of low-cost, well-educated, highly adaptive and industrious workforce, which has been proven by its remarkable success in the readymade garments (RMG) manufacturing and export sector. Compared with its neighbours, Bangladesh's energy prices are much cheaper.

According to BEZA's vision document, other than infrastructure, BEZA will provide multiple incentives to the developer of an economic zone and investors in a particular industrial unit. These will include fiscal benefits, such as tax exemption, customs / excise duties, and non-fiscal incentives, such as no FDI ceiling, work permits and citizenship

The BEZA vision document also expresses incentive package information for both developers and unit investors. For developers, income tax will be exempted for 12 years. For unit investors, income tax will be exempted for 10 years