#1Investment Opportunities in the EPZs Of Bangladesh IL BEPZA Presentation By Major General Mohd. Habibur Rahman Khan, ndc,psc Executive Chairman BANGLADESH EXPORT PROCESSING ZONES AUTHORITY (BEPZA)#2Definition of EPZ An export processing zone is defined as a territorial or economic enclave in which goods may be imported and manufactured and reshipped with a reduction in duties / and/or minimal intervention by custom officials (World Bank 1999) 2#3Mission Of BEPZA TO STRENGTHEN THE ECONOMIC BASE OF BANGLADESH BY: PROMOTING INVESTMENT & GENERATION OF EMPLOYMENT#4Objectives Of BEPZA * PROMOTION OF FOREIGN (FDI) & LOCAL INVESTMENT EMPLOYMENT GENERATION & POVERTY ALLEVIATION TRANSFER OF TECHNOLOGY DEV. OF BACKWARD & FORWARD LINKAGES PROMOTION OF EXPORT#5Background & Development Of BEPZA * BEPZA Act, 1980 & Foreign Private Investment Act, 1980 * 1st EPZ * 2nd EPZ : Chittagong became Operational in 1983 : Dhaka starts in 1993 * Then 6 EPZS: Mongla, Comilla, Ishwardi, Uttara (Nilphamari), Adamjee & Karnaphuli. Chittagong - EPZ Dhaka - EPZ Mongla - EPZ MONGEA#6Management BOARD OF GOVERNORS CHAIRED BY THE HON'BLE PRIME MINISTER EXECUTIVE BOARD EXECUTIVE CHAIRMAN, MEMBER (IP), MEMBER (ENG), MEMBER (F) EPZ HEADED BY GENERAL MANAGER#7UTTARA- EPZ EPZs Of Bangladesh DHAKA- EPZ INDIA Rajshahi ISHWARDI- EPZ Sylhet ADAMJEE-EPZ MONGLA-EPZ INDIA Khulna Barishal INDIA COMILLA-EPZ Chittagong CHITTAGONG- EPZ BAY OF BENGAL MYANMAR KARNAPHULI-EPZ 7#8Investors From 37 Countries TYPES OF INVESTMENT (UPTO February, 2014) 榮 AKC A 100% FOREIGN OWNERSHIP B JOINT VENTURE C 100% LOCAL VENTURE In Operation Under implementation (LA) Sanctioned Industry Total 239 56% 62 15% 128 29% TEK 429 100% 103 31 563#9Why You Should Invest In EPZs BETTER LAW & ORDER SITUATION GOOD INFRASTRUCTURE FACILITIES REDUCTION OF LEAD TIME LESS COST OF DOING BUSINESS FRIENDLY POLICY OF THE GOVERNMENT ATTRACTIVE INCENTIVES (FISCAL & NON-FISCAL) WIN-WIN VENTURES SUCCESS STORY 10#10Legal Protection For The Investors Signatory of * MIGA (Multilateral Investment Guarantee Agency) ICSID (International Centre for Settlement of Investment Dispute) Member of * WIPO (World Intellectual Property Organization) * OPIC (Overseas Private Investment Corporation) MIGA ICSID International Centre for Settlement of Investment Disputes WORLD INTELLECTUAL PROPERTY ORGANIZATION SKIPO 11#111380C Infrastructure Facilities Fully Serviced Plots (Avg Size 2000 SQM) Factory Building Available on Rental Basis Business Support Services: Courier,Banks, C & F Agent, Shipping Agent, etc. Administrative Support Services: Commissariat, Health Club, Investors Club, Medical Center, Sports Complex, etc. HSBC Bank Asia B Bank Asia#121. 2. 3. 4. 5. 6. Reduction Of Lead Time INTRA & INTER ZONE EXPORT-IMPORT ALLOWED DA BASIS IMPORT SIMPLIFIED IMPORT EXPORT PROCEDURE IP & EP ISSUED WITHIN THE SAME DAY IMPORT OF RAW MATERIAL FROM DOMESTIC TARIFF AREA (DTA) SUB-CONTRACTING ALLOWED BOTH INSIDE & OUTSIDE EPZ#13Incentives (Fiscal) 1. TAX HOLIDAY 2. ૧ 3. 4. 5. DUTY FREE EXPORT & IMPORT EXEMPTION FROM DIVIDEND TAX GSP FACILITY AVAILABLE DUTY & QUOTA FREE ACCESS TO EU (EBA), CANADA, NORWAY, AUSTRALIA & USA UNDER PROCESS#14Incentives (Non-Fiscal) 1. 100% FOREIGN OWNERSHIP PERMISSIBLE 2. ENJOY MFN (MOST FAVORED NATION) STATUS 3. NO CEILING ON FOREIGN INVESTMENT 4. FULL REPATRIATION OF CAPITAL & DIVIDEND 5. BEPZA ACCORDS RECOMMENDATION FOR RESIDENTSHIP / CITIZENSHIP#15Branch www. Serdari Chartered FedEx Braden Express Ca Lad Support Service Facilities A WORK PERMITS ISSUED BY BEPZA IP & EP ISSUED WITHIN THE SAME DAY NO UD (Utilization Declaration), IRC (Import Registration Certificate), ERC (Export Registration Certificate) RENEWAL OF BOND LICENSE REQUIRED IMPORT & 10% SALE TO DTA (LOCAL MARKET) ALLOWED CUSTOMS CLEARANCE AT FACTORY SITE INTRA/INTER ZONE SUB-CONTRACTING & TRANSFER OF GOODS ALLOWED AVAILABLE WORKFORCE 16#16Asia's Most Competitive Production Base Comparative Monthly Minimum Wages China Thailand Philippines Jordan Malaysia India Indonesia Vietnam Pakistan Sri Lanka Bangladesh 72 $70 87 96 142 163 191 212 211 294 432 17#17Service Charge - Rent Chittagong - EPZ Dhaka - EPZ FARAR GAZ Mongla - EPZ MONGLA Ishwardi- EPZ ZONE CHITTAGONG, DHAKA COMILLA, ADAMJEE, & KARNAPHULI EPZ MONGLA, ISHWARDI & LAND (US$/SQM / YEAR) 2.20 SFB (US$/SQM / MONTH) 2.75 1.25 1.60 UTTARA EPZ 18#18CONILIBER COMILLA EPZ Service Charge - Utilities ADAMJEE EPZ ADABUR KARNAPHULI EPZ UTTARA EPZ Name of the EPZ Chittagong EPZ Dhaka EPZ Comilla EPZ Karnaphuli EPZ Adamjee EPZ Ishwardi EPZ Mongla EPZ Uttara EPZ Electricity (Per KWH) Water (Per CUM) Taka 7.50 US$ 0.09(approx.) Taka 7.50 US$ 0.09(approx.) Taka 7.50 US$ 0.09(approx.) Taka 10.26 (peak) US$ 0.13 (approx.) Taka6.56(off peak) US$ 0.08(approx.) Taka 7.50 US$ 0.09(approx.) Taka 7.50 US$ 0.09(approx.) Taka 7.50 US$ 0.09(approx.) TTaka 7.50 US$ 0.09(approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) Taka 23.56 US$ 0.30 (approx.) *Tariffs are subject to change in future Gas (Per CUM) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) Taka 6.45 US$ 0.08 (approx.) 19#19Investment YEAR INV ($m) 3500.00 1994-1995 35.93 3000.00 1995-1996 30.58 2500.00 1996-1997 53.90 2000.00 1997-1998 68.83 1500.00 1998-1999 71.61 1000.00 1999-2000 34.98 500.00 2000-2001 48.41 0.00 2001-2002 55.61 2002-2003 102.63 1983-84 1984-85 1985-86 1986 1987 992-93 2003-2004 115.04 2004-2005 118.52 005-06 2006-07 2007-08 2008-09 2011-12 2012-13 2013-14 (Feb.14) 2005-2006 112.89 2006-2007 152.37 2007-2008 302.19 BEPZA 2008-2009 Signing Ceremonial 148.03 2009-2010 221.99 2010-2011 313.23 2011-2012 339.26 2012-2013 328.53 2013-2014 235.11 Feb, 2014 TOTAL ACTUAL INVESTMENT= $ 3020.59 m 20#20YEAR EXP ($m) 40000 1994-1995 228.26 35000 1995-1996 337.02 30000 1996-1997 462.77 25000 1997-1998 636.05 20000 1998-1999 711.69 15000 1999-2000 890.81 10000 2000-2001 1067.87 5000 2001-2002 1077.02 0 2002-2003 1200.00 2003-2004 1354.00 2004-2005 1548.68 2005-2006 1836.18 2006-2007 2063.67 2007-2008 2429.58 2008-2009 2581.70 2009-2010 2822.54 APL 2010-2011 3697.62 2011-2012 4210.80 2012-2013 4,856.68 2013-2014 3,524.79 Feb, 2014 Export 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 TOTAL EXPORT: US$ 38,027.16 m 21 2013-14 (Feb.14)#21BEPZA's Contribution To National Export YEAR BEPZA'S TOTAL EXPORT OF BANGLADESH (US$m) TOTAL EXPORT OF EPZS CONTRIBUTION (%) (US$m) 1996-1997 4418 463 10.48 1997-1998 5161 636 12.32 1998-1999 5313 712 13.40 1999-2000 5752 891 15.49 2000-2001 6467 1068 16.51 2001-2002 5986 1077 18.00 2002-2003 6548 1200 18.33 2003-2004 7603 1354 17.80 2004-2005 8655 1549 17.90 2005-2006 10526 1836 17.44 2006-2007 12178 2064 17.00 2007-2008 14111 2429 17.22 2008-2009 15560 2582 16.60 2009-2010 16250 2822 17.36 2010-2011 22924 3698 16.13 2011-2012 24,41 0 4210 17.24 2012-2013 27,018 4856 17.97#22Employment YEAR No of EMPL 450000 1994-1995 6,141 400000 1995-1996 10,706 350000 1996-1997 12,773 300000 1997-1998 250000 14,049 200000 1998-1999 14,059 150000 1999-2000 9,890 100000 2000-2001 16,020 50000 2001-2002 8,764 0 2002-2003 10,167 2003-2004 10,071 2004-2005 15,802 2005-2006 23,021 2006-2007 23,360 Male -36% 1,37,481 2007-2008 17,130 2008-2009 16,394 2009-2010 28,064 2010-2011 43,666 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 (Feb,14) □ Female Male 2011-2012 33,598 Female -64% 2,44,409 2012-2013 33,987 2013-14 (Feb,2014) 8,222 TOTAL EMPLOYMENT: 3,81,890 nos. 23#23Country Wise Enterprises (Upto Feb, 2014) SL Country Enterprise Investment (Nos.) (US$m) Employment (Nos.) S Country Enter. L (Nos.) Invest. (US$ m) Emp. (Nos.) 1 BANGLADESH 128 744.654 81,167 20 BELGIUM 1 10.545 440 2 S. KOREA 73 604.094 88,444 21 FRANCE 3 9.228 433 3 CHINA * 50 399.13 59,278 22 IR IRELAND 1 3.121 691 4 TAIWAN, CHINA 25 227.917 17,657 23 SWEDEN 13.503 4,397 5 JAPAN 25 285.547 11,077 24 RUMANIA 1 6.065 2937 6 INDIA 21 60.301 13,848 25 UKRAINE 1 4.674 842 7 UK 18 95.545 23,650 26 PANAMA 1 2.892 2,191 8 U.S.A 17 116.804 20,450 27 MARSHAL 1 19.953 454 9 MALAYSIA 9 104.756 4,644 ISLAND 10 PAKISTAN 7 20.111 2,357 28 SPAIN 1 3.032 277 11 SRILANKA 6 65.024 14,285 29 | UA UAE 1 0.591 328 30 MALTA 2.713 539 12 GERMANY 6 22.518 5,447 13 NETHERLAND 5 35.642 31 4,615 TURKEY 1 1.383 45 14 ITALY 15 BR. VERGIN IS. 15 10 47.131 3,349 32 THAILAND 1 0.484 814 5 43.472 8,174 33 AUSTRALIA 1 0.026 67 16 CANADA 17 SINGAPORE 10 5 46.753 2,674 34 CAYMAN ISLAND 1 3.583 272 3 3 9.821 2,752 35 PORTUGAL** 1 0.117 18 DENMARK 19 INDONESIA 2 2.896 1,354 36 M MOURTIUS** 1 0.007 2 9.760 1,941 37 KUWAIT** 1 0.300 TOTAL 429 *HONGKONG INCLUDING IN CHINA ** UNDER IMPLEMENTATION 3,020.59 3,81,890#24Product Wise Enterprises (Up to February, 14) Enterprise Investment Employment SI Product (Nos.) (US$ m) (Nos.) 1 GARMENTS 104 991.924 2,27,800 2 GARMENTS ACCS. 80 380.046 19,635 3 KNIT & OTHER TEXTILE 41 236.310 31,771 4 TEXTILE 39 537.955 22,142 5 FOOTWARE & LEATHER 29 173.850 26,405 6 ELEC & ELECTRONICS 16 112.858 3,984 7 TERRY TOWEL 18 75.384 7,894 8 METAL PRODUCT 13 40.427 2,418 9 PLASTIC GOODS 14 39.746 2,175 10 TENT 8 65.418 8,552 11 AGRO PRODUCT 6 3.201 338 12 SERVICE ORIENTED INDUSTRIES 7 39.686 1,037 13 CAPS 5 52.420 8,178 Murp 14 Chemical 5 12.608 93 15 FURNITURE 3 34.592 2,782 16 ROPE 2 6.711 554 17 FISHING REEL & GOLF 1 33.604 826 18 POWER INDUSTRY 2 96.043 119 19 PAPER PRODUCT 2 1,481 108 20 Sports Goods 1 1.444 381 21 Toys 1 9.664 761 MISCELLANEOUS 29 75.272 13,937 Cr. Total 120 3.020 503 3 81 890#25Zone Wise Statistics (up to February, 14) EPZ Industry Investment Export Employment (US$ m) (No.) (US$ m) In Op. U/Impl (No.) . (No.) CEPZ 172 12 1,155.207 18,628.72 183,994 DEPZ 100 8 1,008.230 15,614.52 88,536 AEPZ 41 20 237.612 1,084.94 32,906 COMEPZ 33 32 187.674 1024.03 14,966 KEPZ 40 18 288.510 1194.78 42,352 IEPZ 13 19 75.044 191.53 6,293 MEPZ 18 14 13.220 223.10 1,690 UEPZ 12 11 55.093 65.52 11,153 Total 429 134 3,020.593 38,027.16 381,890 26#26Global Ranking 2011-12 by FDI Magazine TOP 10 FREE ZONES OF THE FUTURE 2012/13 OVERALL. RANK NAME OF ZONE 1 Dubai Airport Free Zone 2 Dubai International Financial Centre COUNTRY UAE UAE 3 Shanghai Waigaoqiao Free Trade Zone 4 Iskandar 5 DuBiotech 6 Tanger Free Zone 7 Free port of Ventpils 8 The Clark Freeport Zone 9 Chittagong Export Processing Zone 10 Dubai Media City China Malaysia UAE Morocco Latvia Philippines Bangladesh UAE 27#27Global Ranking 2010-11 by FDI Magazine TOP 10 BEST COST EFFECTIVENESS RANK NAME OF ZONE 1 Clark Freeport 2 Togo Export Processing Zone 3 Chittagong Export Processing Zone 4 Free Port of Ventspils 5 International Media Production Zone 6 Rezekne Special Economic Zone 7 San Luis Potosi 8 Mauritius Freeport 9 Industrial Estate of Thailand 10 Starachowice Special Economic Zone COUNTRY Philippines Togo Bangladesh Latvia UAE Lativa Mexico Mauritius Thailand Poland 28#28Global Ranking 2010-11 by FDI Magazine TOP 10 BEST ECONOMIC POTENTIAL RANK NAME OF ZONE 1 San Luis Potosai 2 3 4 Industrial Estates of Thailand Jebel Ali Free Zone Chittagong Export Processing Zone Jubail Industrial City II Amata Nakorn Industrial Estage Clark Freeport 10 5 6 7 8 9 Jazan Economic City 10 Masan Free Trade Zone 11 Rakia Industrial Zone Aqaba Special Economic Zone COUNTRY Mexico Thailand UAE Bangladesh Saudia Arabia Thailand Philippines Jordan Saudia Arabia South Korea UAE 29#29BHAT 56323 CAN 05553 BFC HHE $20220 KLH IM#133504 STARTER ISLANDER UNIVEBA Born in the USA basic Brand Products NORTHWEST TERRITORY OZARK EDITIONS TRAIL. ROUTE BRIDE 66 I extreme boundaries. no AMERICAN EAGLE CHUTTETTERS MAIL BOX reebok miller's CLASSIC HEAR OLYMPUS Virus STATE CART TEAM Athletic CHAMR LOONEY TUNES VALERIE WUOLMARK STEVENS CHRIS CITOLKS DXCC MARKS& SPENCER SPOR RAX NIKE, REEBOK, LAFUMA, H & M(SWEDEN), GAP, BROUKS, J.C. PENNY, WALMART, KMART, OSPIG(GERMANY), MOTHER CARE (UK), LEE, WRANGLER, DOCKERS, NBA, TOMMY HILFIGER, ADIDAS, FALCON (USA), EDIE BAUYER, EAGLE, RELEIGH(UK), EMMILEE, FREE SPIRIL(UK), MILES(GERMANY), AMERICAN EAGLE, HI-TECH(UK), PHILLIP- MAURICE(UK), WINS MORE, DECATHLON. LL CAMERA LENS (IO PARTS) KONIKA, MINOLTA, NIKON, FUJI, OLYMPUS. GOLF SHAFTS MOBILE PARTS AUTOMOBILE PARTS ABU GARCIA SONY ERICSSON NISSAN, MITSUBISHI, HINO, TOYOTA. 30#30Conclusion ASIA'S MOST COMPETITIVE PRODUCTION BASE A BONANZA FOR INVESTMENT#31THANK YOU