The eight export processing zones (EPZ) under the Bangladesh Export Processing Zones Authority (BEPZ) received 29% of total foreign direct investment (FDI) in the 2023-24 financial year (FY).
The country received FDI worth $1.47 billion in FY24, according to Bangladesh Bank data.
Among this, the investment in the BEPZA EPZs was $424.29 million, said Md Ashraful Kabir, member (investment development) of BEPZA, at a press meeting at its head office in the capital’s Green Road on Monday.
He also said that of the $44.47 billion in total exports in FY24, $7.07 billion worth of goods were exported from BEPZA-operated zones, which was 16% of the total exports.
Moreover, despite a challenging year from both a domestic and global perspective, the BEPZA zones signed 28 investment contracts worth $568.49 million in 2024, which is expected to generate employment for 65,662 people.
The notable investing countries include China, the Netherlands, Ireland, the UK, and Bangladesh.
“The eight export processing zones (EPZs) under BEPZA and the BEPZA Economic Zone occupy only 3,445 acres, or 13.95 square kilometres, of the country's total area. Despite their limited size, these zones played a crucial role in attracting $424.29 million in FDI out of the country's total $1.47 billion in FY24,” he added.
He also said that the readymade garment (RMG) sector earned about 85% of total export earnings, while the earnings of the BEPZA zones’ RMG factories are around 52%. This means the EPZ manufacturers earned 48% of export earnings from diversified products.
“Among our 48% of diversified products, the notable products are drones, shoes, shoe accessories, socks, processed leather, handmade bags, backpacks, travel bags, tents, cartoons, packaging materials, and even coffins,” he added.
EPZ Labour Act: No problem with two laws together
The BEPZA executive chairman said Bangladesh has no challenge regarding the EPZ Labour Act and Bangladesh Labour Act as it is not obligated to merge the two laws.
“ILO has never asked why there are separate labour laws for EPZ and the country. Their concern is mainly about their convention, which Bangladesh has signed. Whatever law Bangladesh makes, it should ensure the right of workers to form associations and collective bargaining,” he added.
He also said ILO does not even mention trade unions. They said workers’ associations can be by any name.
EPZ formulated the Workers' Association and Industrial Relations Act 2004 in coordination with all domestic and foreign stakeholders. Over time, this act has reached its current stage with some recommendations from the ILO.
EPZ formulated the Labour Act 2019 and the EPZ Labour Rules in 2022 in this context.
“The two laws can go together. There is no problem. The important thing is what investors want, what workers want, and what the ILO wants. The government will determine the policy based on their demands. There is no fundamental difference between these two laws. The issue of making it uniformed can still be considered if all parties want,” he added.
Investment declines by 22.33% in Jul-Dec of 2024
In response to a journalist's question, BEPZA Executive Chairman Maj Gen Abul Kalam Mohammad Ziaur Rahman said foreign investment in EPZs decreased by 22.33% during July-December of 2024 compared to the same period of 2023 due to the ongoing instability in the global economy and the changing political situation in Bangladesh.
He also said the FDI in the EPZs was $126.33 million during July-December of 2024 compared to $162.66 million in the same period of the previous year.
According to businesses, investment in the country declined by around 71% during that time due to the political transition.
The BEPZA executive chairman said investment declined significantly in the factories outside the EPZs. However, the decline rate was relatively low in the EPZ factories.
“In the last six months, investment in BEPZA has decreased slightly compared to before. However, the reason behind the decline is not only the domestic political situation. Global economic turmoil and dollar crisis also contributed to this decline,” he added.
He also hoped the situation would improve in the future as domestic and foreign investors were already approaching the authority.
“There will be challenges exporting goods from China to the US with Trump back at the office. These companies are now considering relocating their establishments from China to Bangladesh,” he added.
He also stressed the strategic importance of EPZs in supporting the country's economic progress. He added that uninterrupted fuel and energy supply will remain a challenge. However, if this can be overcome, there will be no issues with investment flow.
According to BEPZA, it attracted a total of $6.91 billion in investments and facilitated exports, totalling $114.91 billion by December 2024.
BEPZA said the new horizon for investment will be its economic zones at Mirsarai, Jashore, and Patuakhali.
ASM Anwar Parvez, executive director (PR) of BEPZA, moderated the event, which was participated by other senior officials.
