A free-trade zone, or otherwise called the foreign trade zone (FTZ), is a geographic area where traded goods can land, be stored, manufactured, and re-exported while being exempted from customs duties. FTZs are instituted around seaports or at border crossings, bringing benefits like reduced tariffs and increased global market competitiveness. So what are some of the major FTZs around the world?
Shanghai FTZ
Shanghai’s free-trade zone encompasses the world’s busiest seaport, with an average daily cargo value of $1.6 billion. As a result, Shanghai FTZ has become a model figure for other FTZs in China. Shanghai boasts the world’s busiest seaport and is crucial to the trading landscape. Guangzhou and Shenzhen are also in the top five busiest seaports, and their governing province, Guangdong, has a large FTZ as well. A new FTZ on the island of Hainan is the only one that is physically larger than Shanghai’s. Even though all of these FTZs are in the same country, it is important to note that they have different regulations and purposes.
Dubai
Over 30 free-trade zones are currently operating in just Dubai alone. Again, all these special economic zones are different. While it wouldn’t be accurate to label any one of these zones as the most important, Dubai’s myriad FTZs will likely continue to play a crucial role for many years.
Eko Atlantic
Officially known as Nigeria International City, Eko Atlantic is a planned city in Lagos State, Nigeria, which is Africa’s largest city. With a massive population and a growing economy, Nigeria is looking at how it will do business as the importance of oil recedes. Eko Atlantic is mainly a bold attempt to make Nigeria a notable player in commerce and trade.
Shannon Free Zone
Much of recent trade talks have centered around the Republic of Ireland–Northern Ireland Border. However, this does not mean we should disregard the international business park around Shannon Airport in County Clare. While not particularly important on a global scale, the Shannon Free Zone is the first-ever FTZ in history, which makes it worthy of mention.
Windsor-Essex Foreign Trade Zone
The Ambassador Bridge connects America to Canada from Detroit to Windsor. Approximately a quarter of all trade between the nations traverses the bridge. However, the Windsor-Essex FTZ isn’t vital for trade between the US and Canada since the United States-Mexico-Canada Agreement (USMCA) governs trade between the two countries. Such trade agreements explain why FTZs are generally not as important in North America, the European Union, and ASEAN nations since they reduce the need for FTZs. However, the Windsor-Essex FTZ still encourages collaboration between American and Canadian companies to sell products to third party nations, making it pertinent to the two.
Connect with EXIMA
EXIMA helps you connect with trade professionals from all over the world. If you are interested, make sure to check out our site!
