le="font-size: 10pt; font-family: Arial; color: black" lang="EN">The word "special" mainly means special economic systems and policies. In the People's Republic of China , the central government gives SEZs special policies and flexible measures, allowing SEZs to utilize a special economic management system.

  1. Special tax incentives for foreign investments in the SEZs.
  2. Greater independence on international trade activities.
  3. Economic characteristics are represented as "4 principles":
    1. Construction primarily relies on attracting and utilising foreign capital
    2. Primary economic forms are sino-foreign joint ventures and partnerships as well as wholly foreign-owned enterprises
    3. Text Box: 30
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      1. Role of International Institutions

      As Export processing zones were seen by the international financial institutions as one of the essential ingredients of the opening up of the Third World economies, several institutions played a key role in creating and legitimizing the concept of EPZ. They include:

      Ř       World Bank,

      Ř       United Nations Industrial Development Organisation (UNIDO),which was  instrumental in the creation of the World Export Processing Zone Association (WEPZA)

      Ř        International Labour Organisation (ILO) which has been playing a deterministic role by formulating guideline for labour policies in the EPZs and

      Ř       United Nations Conference on Trade and Development (UNCTAD) which has contributed greatly to legitimising the idea of EPZs through basic studies on the costs, benefits and advantages of these zones

      2. World export processing Zones Association (WEPZA)

          (http://www.wepza.org/)

      Founded in 1978 by the United Nations, WEPZA is the private non-profit World Association of Economic Processing Zones and Free Trade Zones. It is an independent association dedicated to the improvement of the efficiency of all Economic Processing Zones (EPZs) through:

      • Periodic exchange of information at WEPZA Conferences and Workshops
      • Recruiting and training EPZ Management
      • Research on markets and trade flows supplied to members as the WEPZADB database
      • Creation and maintenance of the WEPZA Website on the Internet
      • Cooperative Transport arrangements to reduce costs
      • Networks of subcontracting and purchasing among zone factories
      • Cooperative promotion of EPZs to manufacturers and services providers worldwide
      • Periodic discussions between EPZs and the manufacturing/services community
      • Representing Free Zones and EPZs before international bodies in defense of their interests and their freedoms

      Following 4 years of study WEPZA was founded at Manila , Philippines in 1978 by the UN as an organization of 29 governments experienced in the development of export processing zones

      Contact Details of WEPZA

      World Economic Processing Zones Association (WEPZA)
      PO Box 3808
      Evergreen, CO 80437-3808 USA
      Tel: (303) 679-0980
      Fax: (303) 679-0985
      E-mail: director@wepza.org

      3.       Introduction to Free trade Zones

      The concept of free trade zones date back to 18th century . During those days , the concept existed in form of free ports. Certain ports which had geographic , historical or political advantages  and were major international trading posts like Trieste and Aden were converted to free ports .These ports were free of custom duties or had favourable custom regulations.

      Growth of international trade has given a new life to this historic concept. Countries in all stages of economic development have become active participants in production and trade. The concept of manufacturing has undergone a sea change. It is no longer limited to regions with surplus availability or proximity to market. It is not products but components or materials for manufacturing which constitute a a higher percentage of trade . To make local manufacturing/ processing competitive in the international market ,it is important to provide :

      §         access to efficient transportation services

      §         adequate production infrastructure to local entities.

      §         a hassle free legal environment

      §         investor friendly tax regime

       

      This situation has induced the adoption of tax incentive programs in countries throughout the world. While the scope of benefits varies, there are features that are common across national borders. One such feature involves the use of special Customs procedures to mitigate the import tax burden.

      This type of incentive is related to the free port concept of yesteryears, and projects that feature contemporary free port type exemptions today are generally known as "free trade zones". Most are located as part of sea/air port complexes or industrial estates. Some of the terms used to refer to various types of free trade zones are: "free port", "free zone", "Customs free zone", "entrepot", "industrial free zone", "foreign-trade zone" (FTZ), and "export processing zone" (EPZ). When incentive programs cover a region, terms such as "economic zone" or "free perimeter" are used.

      The basic special treatment foreign goods receive under "zone" procedures is the deferral of payments on imports and duty-exemption for exports. Most zone programs include a variety of other tax breaks, but the Customs benefit is the signature feature that marks an incentive program as being within this grouping.

      4.  A brief note on the following free economic zones follows:

      1)   Belarus-Minsk free trade zone

      2)   China

      3)   Dubai- Jebel Ali Free zone

      4)   Iran 's Special Economic & Free Trade Zones

      5)   Ireland

      6)   Latin America

      7)   Malaysia

      8)   Phillipines

      9)  South Korea

      10) Sri Lanka

      1)   BELARUS-MINSK FREE TRADE ZONE

      Location: The creation of a free economic zone has been determined by the Special Presidential Decree of the of Republic of Belarus issued on 2\3\98. The territory of a free economic zone includes the territory of an industrial zone "Shabany", unoccupied territories near the National airport " MINSK ", settlments "Obchak", "Elnitsa", "Prelesye", factory "Radian".

      Area: The total area of the free economic zone within established borders for the potential investment projects constitues 1390,0 hectares. free economic zone is created for the period of 30 years. The management of free economic zone " MINSK " is realised by the Administration, being a body of state management.

      Objectives:

      o        Stimulation of creation and development of manufactures,

      o         maintenance of an unused industrial, intelligent and export potentials of the region;

      o        Organising of a large transport complex on the basis of the National airport " MINSK "

      o         Increase of an export and involvement of Minsk enterprises and Minsk area into the international economic relations;

      o        Attraction of the foreign and private domestic capital to investment of the industrial projects on the in a free economic zone " Minsk ".

      o        Providing for an employment of the population and solving other socio economic problems of region.

      Benefits:

      o        Profit and income tax - 15 %; VAT - 10 %;

      o        The profit, directed on the investment, is not obliged to the taxes;

      o        The profit, received from realization of production of own manufacture is released from taxes for 5 years;

      o        No custom duty charged on import of  goods into the territory of the free economic zone " Minsk "

      o         Depending on volume of the investments and their direction the privileges on the rent payment of the ground, premises and utilities are granted.

      2)  Special Economic Zones in the People’s Republic of China

      Index

      1. Introduction
      2. List of SEZ’s in PRC
      3. History
      4. Benefits of an SEZ
      5. Points to be considered before investment
      6. Shenzen Economic Zone

      7.       Ningbo FTZ, EPZ

      1. SEZ’s in China and India
      2. Regulations On Special Economic Zones In Guangdong Province
      3. Government Structure
      4. Implementing Rules of Regulations of Shenzhen Special Economic Zone on Liquidation of Enterprises
      5. Regulations of Shenzhen Special Economic Zone on Administration of Physical Culture Operation
      6. Legislation relating to Special Economic Zones in China

      Introduction

      China is the third largest country in the World, just behind Russia and Canada . The population of China is over 1.2 billion people. This is about one-fifth of the world's population.

      China is a very diverse land including deserts, mountains and fertile river basins.

      Much of western China is mountains with the Himalaya, Tian and Pamir ranges. Western China also has a large desert. Central China consists of mountainous regions.

      Rivers also play a major role in China , both for transportation and for irrigation. Much of the northern wheat fields and southern rice fields are irrigated from rivers.

      The Great Wall of China was built over 2,500 years ago to protect against invaders from the north. Troops would patrol the wall to defend China against attack. Once over 6,000 miles long, the wall is now about 3,750 miles long.

      For many years, China has been on a program of economic development. China has considerable natural resources including coal, lead, zinc, copper, tungsten and gold. China also has considerable oil reserves.

      Special Economic Zone (SEZ) is a geographical region that has economic laws different from a country's typical economic laws. Usually the goal is an increase in foreign investment. Special Economic Zones have been established in several countries, including the People's Republic of China , India , Jordan , Poland , Kazakhstan , the Philippines and Russia . North Korea has also attempted this to a degree.

      Special Economic Zones(SEZ's) are development zones established by the People’s Republic of China to encourage foreign investment in China , bringing much needed jobs, technical knowledge, and future tax revenues in return for significant tax concessions at start-up of the operations and over a number of years. They are not unlike SEZs in other part of the world.