Dhaka, Bangladesh (BBN)- The central bank of Bangladesh has allowed type ‘A’ industries in Export Processing Zones (EPZs)/Economic Zones (EZs) to borrow short-term foreign currency loans from parent companies abroad and other similar subsidiaries operating in EPZs/EZs in Bangladesh.
“We’ve relaxed foreign exchange regulations allowing all ‘A’ category industrial units in EPZs/EZs to facilitate their business in Bangladesh through receiving short term foreign currency loans from parent companies/shareholders abroad and other type ‘A’ subsidiaries/associates operating in EPZs/EZs,” a senior official of the Bangladesh Bank (BB) told BBN in Dhaka.
Currently, all ‘A’ category industrial units in EPZs/EZs have been barred to borrow from local sources, the central banker added.
In order to ease short term borrowing by type ‘A’ industries in EPZs/EZs, it has been decided that they may access short term foreign currency loans from parent companies/shareholders abroad and other type ‘A’ subsidiaries/associates operating in EPZs/EZs, according to a notification, issued the BB on Sunday.
“In the context of such short term loans within subsidiaries/associates operating in EPZs/EZs, ADs shall, before transferring the fund, satisfy themselves that the fund is unencumbered,” it noted.
Under the existing regulations, type A industries in EPZs are allowed to obtain short term foreign currency loans from overseas banks and financial institutions subject to observance of the stipulated instructions.
Besides, the central bank of Bangladesh earlier relaxed foreign exchange regulations allowing all industrial enterprises in the EPZs to borrow medium and long-term loan from overseas sources.
There are three categories of industrial unites now operating in all EPZs across the country.
BBN/SSR/AD