Central bank allows EPZ enterprises more facilities [ LAST PAGE ] 17/07/2017
Central bank allows EPZ enterprises more facilities
Foreign-currency loan convertibility in package
Industrial enterprises operating in Bangladesh's Export Processing Zones (EPZs) are now eligible to enjoy more facilities like those in the Economic Zones (EZs), including currency convertibility.

In the new package of facilities is a provision under which 'Type B' and 'Type C' industries of EPZs can now get foreign currency from the banks concerned for  importing  capital  machinery  by  the  conversion  of  equivalent  equity  and/or  authorised  loans  received  in  local  currency with prior approval from the Bangladesh Bank (BB).

Besides, equity from foreign shareholders of 'Type A' and 'Type   B' enterprises and authorised  loans  received  in  foreign  currencies from  external  sources  by  EPZ  industries are eligible to credit into their FC (foreign currency) accounts.

The central bank issued Sunday a circular to this effect, asking all authorised dealers (AD) in foreign exchange in Bangladesh to follow the latest instructions related to use of share capital and authorised loans through foreign currency/local currency accounts by the EPZs' industries.

"We've taken the latest moves aiming to bring uniformity in regulations between enterprises of the EPZs and EZs," a BB senior official said while explaining the main objective of the government measure coming through the central bank announcement.

Foreign  investment  in  EPZs  (in  'Type  A'  and  'Type  B'  enterprises)  is  subject  to  report  to the central bank within 14  days of issuance of shares favoring non-resident investors as per instructions stipulated in the Guidelines for Foreign Exchange Transactions (GFET).

'Type  C' enterprises  of  EPZs  may  obtain  foreign  exchange  from  ADs  to  settle  obligations  for  importing  capital  machinery  by  the  conversion  of  equivalent  equity  and/or  authorized  loan  received  in  local  currency, the circular spells out.  

Similarly, 'Type  B'  enterprises  may  convert  their  local   equity/authorised   loans   received   in   local   currency   to   foreign   exchange  to  settle  obligations  for  importing  capital  machinery  if  equity/authorised  foreign  loan  received  from  abroad  falls  short  of fulfilling such  obligations, it added.  

"Instructions regarding repayment of Taka loans along with interest shall remain unchanged," the BB said in its circular.

There are three categories of industrial unites now operating in all EPZs across the country.

A total of 72 'B' category (joint venture) industrial unites are operating while 132 'C' (100 per cent locally owned) in the EPZs.

Besides, 259 'A' category (fully owned by foreigners) are operating in the special economic zones of the country.

"More than 463 industrial unites are now operating in the EPZs while 87   are under implementation," a BEPZA official told the FE.

There are eight EPZs in Bangladesh-located in Chittagong, Dhaka, Mongla, Ishwardi, Comilla, Uttara, Adamjee, and Karnaphuli.
 
 
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