The Erudites for SEZ

SEZ IN RUSSIABased on to the new Federal law, which has come into effect January 2006, six Special Economic Zones (SEZ) have been created in the following regions of Russia: Saint-Petersburg, Dubna (Moscow region), Zelenograd (Moscow region), Elabuga (Republic of Tatarstan), Lipetsk and Tomsk. The main goal is to attract foreign investment and boost not only development of processing industry sectors of economy and production of the new types of goods, but also the development of  high-tech branches and commercialization of the scientific and technical innovations. The economic situation and political stabilization in Russia creates  an opportunity to extend foreign business in Russia. Russia’s competitive capacity could rise on foreign markets by strengthening its own economic co-operation and the growing presence of innovative companies in Russia.

SEZ IN CHINAChina’s government first set up some SEZs in the late 1970s in southeastern China, with an eye on luring dollars back to the motherland from compatriots in Hong Kong, Macao and Taiwan. The SEZs were vital to the development of China’s export machine. The most successful was Shenzhen, which back then was a village on the border of Hong Kong’s New Territories and now is a booming city that’s home to high tech leaders like Huawei and ZTE. Xiamen, along the coast of Fujian province, is directly across from Taiwan and people there speak the same dialect as many native Taiwanese. Dell is a big investor in Xiamen, having just doubled the size of its PC assembly plant in the city. Not all of the original SEZs turned out so well: Shantou, about five hours by car from Hong Kong, is home to a university funded by Li Ka-shing (his hometown is nearby) but not much else. Zhuhai, across the border from Macao, won notoriety in the late 1990s for building a gigantic white elephant of an airport. While China’s SEZs are less important today, when cities nationwide are all vying for investment dollars, it’s hard to imagine China’s economic boom developing so quickly without them.

SEZ IN UAE There are 32 free zones across the UAE, 26 of which in Dubai with activities relating to services and trade. A common set of incentives: 0% customs duties; no quotas; no foreign exchange controls; unrestricted capital and profit repatriation; tax holidays; streamlined labor procedures; no restriction on foreign ownership; reduction in red tape and bureaucracy; and competitive land rates with long term renewable leases. The 100% foreign ownership allowed within the UAE free zones played the major role in the success of these zones.