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Special Economic Zones
EPZs, on the other hand, typically are larger (the smallest ones are in excess of 40 hectares), walled, secured, and considerably well maintained and managed. Moreover, the package of incentives available in the new EPZs for export-oriented activity was not available in any other industrial estate in the country (see Section 3, Performance, for a detailed discussion on the incentives regime). Despite this progress, the EPZs caught on only gradually. It took almost 10 years for the zone to host a meaningful number of companies. But with the growth in global production networks in the garment sector during the 1990s, Bangladesh’s EPZs took off. A second EPZ was started outside Dhaka in 1993 (and later expanded) and an additional six have been opened since then, with several more in the pipeline. Today, eight EPZs are operating under BEPZA, with two new zones in the planning stages. In addition, a privately developed zone, operated by the Youngone Corporation of the Republic of Korea, is under construction near Chittagong. Although the zones are spread throughout the country, in reality, economic activity in the EPZs is highly concentrated: of the eight operating zones, just two of them—Chittagong EPZ and Dhaka EPZ—account for more than 80 percent of the companies operating in the EPZs (see table 2.1). Other than Chittagong and Dhaka, all the EPZs have been launched since 2000. The Adamjee and Karnaphuli EPZs were established on the grounds of suspended state-owned enterprises (SOEs, the former an old jute milling complex and the latter a steel mill), which the government had handed over to BEPZA. The Adamjee EPZ is fully operational and has been attracting investment at a fairly rapid rate. Karnaphuli is partly in the project stage, but it too already has attracted some investment. Table 2.1 Summary of EPZs, 2009 Location Chittagong Dhaka Mongla Ishwardi Uttara Comilla Adamjee Karnaphuli
Year Established 1983 1993 2000 2000 2000 2001 2005 2006
Size (Hectares) 183 140 186 125 93 108 119 109
Source: BEPZA. Note: Data represent the 2008/09 fiscal year.
No. of active enterprises 140 96 12 3 5 18 12 4