The New Age : BEPZA's move shocks investors
$181m investment plans in limbo
The state-owned investment promotion agency has directed 14 foreign investors to suspend construction works of their factories at the extended part of the Karnaphuli export processing zone, making $181.2 million investment plans uncertain. Refereeing to a directive of the Bangladesh Export Processing Zone Authority, the Karnaphuli EPZ has sent a letter to the foreign investors asking them to stop all construction works until further notice.
'This is to inform you that due to unavoidable circumstances you are requested to suspend all infrastructural construction works in the plot 10 to 15 allotted to you until further order by the authority.' Frustration and anger are running among the foreign investors, half of them are from Taiwan and China, after Karnaphuli EPZ served the surprise notice on March 28. The investors have been paying the rent for the plots, which were allocated to them in July 2008 in the EPZ, six kilomtetres from Chittagong port and 12 kilometres from Shah Amanat International Airport.
They said many of them are now mulling to pull back their investment proposals despite the fact that they have already been assured of compensation and allocation of new plots. The BEPZA officials on condition of anonymity told New Age that the allotted plots were previously owned by the food ministry. The ministry now wants back of the land in a bid to increase food storage capacity to ensure the country's food security, they said.
The investors, however, said they were not ready to suffer this kind of problems. Jeff Chuang, managing director of the Cosmos Shoes International, which has planned to invest $16.60 million, told New Age that it would take at least one year to develop new land. 'This will lower the confidence level to our foreign customers,' he said. Steven Chen, chief of the Sheng Tseng, said many of our investors will decide to leave this country that will have a negative impact on foreign direct investment. They urged the investment promotion authority to lift the suspension order.
List of companies and investment proposals
Company Proposed investment Greenland Footwear (BD) Ltd. (Taiwan) $22.17 million Lasting Spring Metal Industrial Ltd. (Taiwan) $10.21 million Cosmos Shoes International Ltd. (Taiwan/USA) $16.60 million Tai Sheng Manufacturing Co. Ltd. (Taiwan) $32.0 million Sheng Tseng Enterprise Co. Ltd. (Taiwan) $8.32 million Daiei International Ltd (Japan/Bangladesh) $3.72 million La Luna Shoes (Bangladesh) Ltd. (China/Taiwan) $19.84 million La Luna (Bangladesh) Ltd. (China/Taiwan) $2.70 million Gokaldas Images (BD) PVT. Ltd $7.63 million Gergasam (Bangladesh) Ltd. (Sri Lanka) $21.39 million Pou Chen International Group yet to submit Zhong Bu Centesin (BD) Company Ltd. (China) $24.22 million Asia Thai Mould Company Ltd. (Korea) $ 2.45 million Jang Won Shoes & Accessories Ind. Ltd (Korea) $9.96 million