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| Free Economic Zone |
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Free economic zone is the area of a country where tariffs and quotas are eliminated and bureaucratic requirements are lowered in order to attract companies by raising the incentives for doing business there. Each zone is set up within a specific country and governed only by that country’s laws. These economic zones promote economic well-being not only of the beneficiaries but of the whole economy of the host country in terms of job creation, attraction of Foreign Direct Investment, transfer of technology and management know-how, regional development and industrialization.
FEZs are also referred to as free trade zones, free ports, export processing zones, industrial free zones, techno parks and technological free zones.
Common Incentives of FEZs include non-discriminatory access to the zone, freedom of transit, no barriers to the use of loading and unloading port facilities; simplified business start-up and license requirements; customs procedures simplification; relief from customs duties: fiscal incentives (relief from VAT, corporate tax, income tax, property tax, local taxes, etc); financial incentives, such as free flow of capitals, free repatriation of capitals, profits and dividends, preferential interest rates; subsidized infrastructure, liberalization of transports to/from the zone; and labor law deregulation.
Today Free Economic Zones and similar initiatives are thriving globally advancing the cause of globalization and stimulating world trade.
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