FBCCI proposes special Japanese EPZ
Tokyo keen to invest in RMG, food processing
Star Business Report
Bangladesh’s business leaders have proposed that Japanese put all efforts to have a separate export processing zone of their own here, which could help raise bilateral trade.
“Japan had set up special Japanese EPZ in China, Thailand and Indonesia. It could also set up such special EPZ in Chittagong and establish direct air link between Tokyo and Bangladesh’s prime port city or via Myanmar or Thailand,” Mostofa Azad Chowdhury Babu, vice president of Federation of Bangladesh Chambers of Commerce and Industry, told a visiting Japanese business delegation yesterday.
Babu also pointed to Bangladesh’s $330.55 million exports to the Asian economic giant last fiscal year against $1.04 billion imports.
Foreign investors have ample scope to invest in the export-oriented industries that make high technology products, the FBCCI leader said. He also pointed out that these industrial units in a special zone could diversify the usage of native natural resources.
Bangladesh needs Japanese support to produce quality product with new technology and competitive price. Woven and knit garment, leather and footwear, shrimps, jute yarn and jute goods are the main products that the country exports to Japan, Babu said.
“In our export trade with Japan, we’re facing stiff competition from China, Korea, Vietnam and Indonesia who have advantage of proximity to Japan,” he said.
During the meeting with Bangladesh’s apex trade body, Yutaka Ienaga, leader of the nine-member delegation that wrapped up its 3-day Dhaka visit last night, expressed their keenness to invest in some sectors such as readymade garment (RMG), manufacture of machinery and food processing.
“We want to invest in Bangladesh. Some of us are in talks with the local partners,” said Ienaga, pointing to Bangladesh’s scope to up RMG exports to Japan as the rules of origin have recently been proposed to be relaxed.
Ienaga is chairman of International Business Committee of Japan’s Osaka Chamber of Commerce and Industry.
The Japanese government will bring down the three-stage formulation to a two-stage one in the case of imports of knitwear to award least developed countries a duty-free access.
Bangladesh, an LDC, is supposed to reap greater benefit from the proposed changes in line with generalised system of preferences (GSP). The relaxed RoO might come into force in April for the LDCs.
Once the new formula is in place, knitwear makers will be able to export to Japan, even if the item is made of imported yarn.
Under the current three-stage formulation, knitwear exporters have to make garments from the fabrics manufactured from locally spun yarn, although raw cotton is imported.
A 17 percent duty on the imports of knitwear items from the countries beyond the LDC category is now in place to protect the age-old Japanese knitwear industry. But the LDCs have long been enjoying zero tariff in woven exports to the Japan market.