BB issues framework for import trade in Free Trade Zones
Under the framework, ADs and Offshore Banking Units (OBUs) will handle FTZ-related transactions in line with foreign exchange regulations.
The Bangladesh Bank introduced a structured framework to regulate import trade into Free Trade Zones (FTZs), aiming to facilitate transactions while ensuring prudent risk management by banks.
The cenbank issued a circular today (16 July) and sent it to all Authorised Dealers (ADs). Under the framework, ADs and Offshore Banking Units (OBUs) will handle FTZ-related transactions in line with foreign exchange regulations.
Eligible importers include industrial enterprises, importers on record authorised to undertake trading activities and logistics service providers operating within FTZs.
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The framework allows consignment-based imports, under which ownership of goods remains with foreign suppliers until the goods are either used in production or sold. Banks will not treat such goods as inventory or assume credit exposure until ownership is transferred.
The circular also sets out how FTZ transactions will be treated. Purchases by domestic buyers will be regarded as imports, while sales by FTZ enterprises will be treated as exports for sellers and imports for buyers.
These transactions must comply with the prescribed EXP and IMP procedures, and all payments must be settled in freely convertible foreign currencies.
Goods imported on a consignment basis may remain in FTZs for up to 48-60 months. Usance imports, including buyer's credit and supplier's credit, will be allowed for a maximum of 270 days.
The framework also permits ADs to extend financing on terms similar to those applicable to specialised zones, while OBUs may provide foreign currency financing within the limits set by the relevant regulations.
Industry insiders said trade operations through FTZs could strengthen local manufacturing, including export-oriented industries, by creating new business opportunities and improving supply chain efficiency.
In June this year, the government approved a proposal to establish the country's first free trade zone in Anwara, Chattogram, aimed at boosting trade, investment, and export capacity.
