What benefits can Azerbaijan get from Free Economic Zone?
Baku, Azerbaijan, Jan. 16
By Sara Israfilbayova - Trend:
The creation of the Free Economic Zones (FEZ) can help to attract foreign investors, create new jobs, increase the labor force capacity, increase the economy not only of the country, but also of the region, President of the World Free & Special Economic Zones Federation (FEMOZA), Juan Torrents, told Trend.
He emphasized that FEZ gives economic benefits to operators and social benefits to the country.
Touching upon the points that may cause inefficiencies in the work of FEZ, he named the creation of FEZ without a previous pre-feasibility study, creation of a Zone without the market evaluation of the country and region, operation of a Zone with a national budget (a Zone has to be self-financed) etc.
Answering the question about what it takes to setup a FEZ, Torrents said that the first step is to create a legislative framework.
“It is also highly recommended to create a National Free Zones Authority, in order to control them. It is easier and offers flexibility,” the FEMOZA president noted.
He went on to say that in order for the FEZ to be successful, it is needed to create favorable infrastructure, a modern management model.
"The Free Zone operator has to be a facilitator of services to the tenants, be flexible in the application of law and customs procedures, to implement always the latest technologies as blockchain," he said.
Torrents also said that Azerbaijan is in the route of FEMOZA’s Digital Silk Road Parks. FEMOZA’s Digital Silk Road Parks envisages a network of Free Economic Zones in Asia and Europe on the millennia-old route of the original Silk Road.
Further, he emphasized that in the last decades, Free & Special Economic Zones are the most important destinations for foreign investment projects, because they offer all critical points, such as strategic location, infrastructure, facilities, incentives, labor force, services, security and comfort to develop activities and production process.
The FEMOZA president underlined that the most critical requirement of a successful Free & Special Economic Zones is the location.
“Location means easy communication with ports, airports, other countries,” he said.
Moreover, he assessed positively the location of the FEZ in the village of Alat in the Garadagh district of Baku.
“I visited Baku with a Mission of the United Nations Industrial Development Organization (UNIDO) in 2007. The Mission was sent to analyze the implementation of the first FEZ in the country,” he said.
The FEZ is being created in the village of Alat on the basis of the presidential decree signed in March 2016. The territory of the new Baku International Sea Trade Port is also included in this zone.
Follow the author on Twitter: @IsrafilbekovaS