Definition[ edit ] The World Bank defines free trade zones as "in, duty-free areas, offering warehousing, storage, and distribution facilities for trade, transshipmentand re-export operations. In other countries, they have been called "duty free export processing zones," "export free zones," "export processing zones," "free export zones," "free zones," "industrial free zones," "investment promotion zones," "maquiladoras," and "special economic zones. Free zones range from specific-purpose manufacturing facilities to areas where legal systems and economic regulation vary from the normal provisions of the country concerned. Free zones may reduce taxes, customs duties, and regulatory requirements for registration of business.
To date, government has designated a number of sites as special economic zones. The EPZs initiative produced mixed results. There were, however, concerns over labour, social, gender-specific and environmental issues.
In particular, there were concerns over the failure to deliver quality employment and a living wage, as well as the high opportunity costs involved. Interestingly, a number of scholars have advocated for economy-wide liberalisation as opposed to implementing SEZs, which they view as a second-best policy.
Other scholars and activists have also criticised SEZs on the grounds of them being discriminatory against domestic investors. Generally, a SEZ can be defined as a geographical site with preferential laws, policies and regulations that are more liberal than those existing in the rest of the economy.
The main motivation for designating SEZs is to attract greater FDI inflows, create jobs and increase exports from the host country. A number of countries were inspired by the Chinese and followed suit, including many African countries such as Ethiopia, Madagascar, Lesotho, Nigeria, Senegal, Ghana and Mauritius.
The failure of SEZs in other countries should, however, not deter us, but rather provide useful lessons, while the success of SEZs in other countries should inspire us. For SEZs to be a success in Zimbabwe, there are a number of key success factors that will need to be addressed.
First and foremost, the success of SEZs is a function of how competitive and strong the domestic economy is. International evidence has shown that SEZs are hindered by the same problems affecting the rest of the economy, such as inadequate infrastructure and institutional weaknesses, among others.
In other words, the success of SEZs does not just depend on the incentives offered in the Zone, but more importantly on the economy-wide conditions prevailing in the country.
In particular, the policy and institutional environment is very important. The more business-friendly and competitive the surrounding environment, the greater the potential SEZs have to stimulate economic activity both within and outside the Zone.
Currently, the investment climate in the country remains highly problematic with both foreign and domestic investment remaining largely subdued. This represents a big threat to the success of SEZs. The country scores badly on the ease of doing business and competitiveness indicators.
According to the World Bank Doing Business Report, the country moved four places down in the ease of doing business rankings from out of countries in to in The country is also ranked out of countries in terms of starting a business, one place down from in On average it takes 91 days to start a business and the process requires 10 procedures.
The key determinants of the investment and business climate include infrastructure hard, soft and socialbusiness regulations and policies and trade facilitation. SEZs are more successful in national economies with adequate infrastructure, in particular, transport and energy infrastructure.An Introduction to Foreign-Trade ZonesForeign-Trade Zones (FTZ) are secure areas under U.S.
Customs and Border Protection (CBP) supervision that are generally considered outside CBP territory upon activation.
Located in or near CBP ports of entry, they are the United States' version of what are known internationally as free-trade zones.
The Special Economic Zones (SEZs) Act was promulgated into law in October , largely to attract foreign direct investment (FDI) inflows, generate employment and promote exports. To date, government has designated a number of sites as special economic zones.
The introduction of SEZs in Zimbabwe is.
Special Economic Zones (SEZs) are generally defined as geographically delimited areas administered by a single body, offering certain incentives (duty-free importing and streamlined customs procedures, for instance) to businesses that physically locate within the zone.
India - Distribution and Sales Channels Discusses the distribution network within the country from how products enter to final destination, including reliability and condition of distribution mechanisms, major distribution centers, ports, etc.
Multiple ports within the GCC owe their success or have benefitted significantly due to their adjacent Special Economic Zones. While within the UAE, Jebel Ali Port and Free Zone in Dubai is the primary example, Khalifa Industrial Zone Abu Dhabi (KIZAD) in Abu Dhabi, Hamriyah Free Zone in Sharjah, and RAK Maritime City Free Zone within Ras Al Khaimah (RAK) are other examples of SEZs being major.
The Special Economic Zones (SEZ) Law 83 of allows establishment of special zones for industrial, agricultural, or service activities designed specifically with the export market in mind.
The law allows firms operating in these zones to import capital equipment, raw materials, and intermediate goods duty free.