How Vital are Export Processing Zones (EPZs) to the Economy of Bangladesh?

Abstract

Export Processing Zones (EPZs) are economic enclaves that act as a key driver for the economic development of Bangladesh through enhancing exports, investment and employment with the supervision of Bangladesh Export Processing Zones Authority (BEPZA). As there are very few studies fully focused on the major contribution of EPZs to Bangladesh economy with respect to export, investment, and employment, the researcher has found it to be a major source of further exploration. The study investigates the contribution of EPZs operating under BEPZA to the economic growth of Bangladesh using both descriptive and analytical approaches with documented data for the last 05 F/Ys. The study employs several statistical tools analyzed using Python (Colab), such as zone-wise and country-wise descriptive and comparative analysis, Export-per-Investment, Export-per-Employee, Investment-per-Employee ratio, efficiency ratio, year-over-year growth ratio, economic strength index, and financial ratios. The results show that EPZs make a positive contribution to the economy of Bangladesh, as such their average contribution for the last 05 F/Ys to national export is 16.16% and to national FDI is 16.75%, despite facing multiple challenges, such as global economic slowdown, trade disruptions, political crises, labour unrest, etc. Additionally, EPZs promote women empowerment and balanced economic growth through ensuring a sustainable and investor and worker- friendly environment. The findings of the study suggest that consistent and effective support policies and research initiatives from the government and BEPZA can address those barriers and find out their remedies that can enhance balanced economic growth of Bangladesh, with a limited number of resources available through our EPZs.