Bangladesh Bank has given the opportunity to provide working capital loans in local currency to foreign and domestic-foreign jointly owned industrial enterprises in the economic zones. Till now these institutions were getting short-term loans in foreign currency only.
On Monday (November 28), the Foreign Exchange and Policy Department of Bangladesh Bank issued a circular. This instruction has been given due to the dollar crisis.
According to the directive, Bangladesh has provided an opportunity to take current capital loans from local sources in favor of type-A and type-B industrial enterprises operating in the economic zone. All the companies which produce for sale in the local market and have no foreign income will get a working capital loan facility in Taka.
Currently, Type-A (100% foreign-owned) and Type-B (domestic-foreign joint ventured) industries can avail of short-term foreign currency loans from foreign sources. Foreign-owned and controlled institutions outside the Special Zones can take working capital loans in taka from local sources on the basis of banker-customer relationship.
This opens the door to current credit facilities for enterprises in the economic zone producing for the local market. Earlier, in 2020, Bangladesh Bank gave these institutions the opportunity to open bank accounts in Taka.
Bangladesh has eight EPZs and they have created a milestone by creating employment for 64,160 Bangladeshi nationals in the fiscal year 2021-22, a 36.51% increase over the previous fiscal year when 47,000 new jobs were created.
On the other hand, the country’s eight EPZs under the Bangladesh Export Processing Zones Authority (BEPZA) attracted record investments in the FY22 surpassing all previous records. Investments increased by 20.26% to $409.80 million in FY22 which was $340.75 million in FY21.