Bank guarantee – A major hurdle for foreign investors in Bangladesh

The Chattogram Customs Bond Commissionerate has introduced a new bank guarantee rule in the newly opened Bangladesh Export Processing Zone Authority (Bepza) Economic Zone at Bangabandhu Sheikh Mujib Shilpa Nagar in Chattogram. Export oriented factories operating in this BEPZA need to provide bank guarantees to get their imported raw materials released. This rule is specific to BEPZA and is not in force in other Export Processing Zones. This is causing unusual delays and financial complications for businesses operating in BEPZA. Such rules are putting businesses into financial losses particularly when there is a dollar crisis, dollar prices have increased or when global trade is in a recession. The delay in releasing goods from the port due to these guarantees has also delayed production, harming foreign investment companies financially.