world fzo bulletin - naftz · world fzo bulletin. ... 1870 1890 1910 1930 1950 1970 1990 2010...

© 2015 I World Free Zones Organization I Bulletin issue 04 ADecember 2015 I Issue 04

World FZO

Bulletin

© 2015 I World Free Zones Organization I Bulletin issue 04© 2015 I World Free Zones Organization I Bulletin issue 04B 1

Dear Members, The World FZO is pleased to present the fourth quarterly Bulletin of 2015.

This issue provides an overview on the nature of free zones in Latin America, in addition to an insight on the role of free zones in the development of SMEs. Also in this issue, fDi Intelligence provides an overview of the latest investments around the world on a regional basis. Finally, it includes an atlas of free zones in Egypt.

The World FZO would like to acknowledge the valuable contribution of Juan Pablo Rivera, Chairman of Free Trade Association of Americas and Christin Pfeiffer, Secretary General of INSME to this issue of the Bulletin.

We wish you a pleasant read and look forward to your valuable input and feedback on this issue of the Bulletin and on all our other services.

With best regards,

The World FZO Knowledge Management Unit

1090, 1st Floor, 7W-B , Dubai Airport Free ZonePO Box 371113, Dubai, United Arab EmiratesT +971 4 204 5473F +971 4 299 3866 E [email protected] worldfzo.org

“Articles [and/or videos] sourced from the Financial Times have been referenced and are used under license from the Financial Times Limited and were originally published in 2015. “FT and “Financial Times” are trade marks of the Financial Times Limited. The Financial Times Limited has not endorsed, verified or been involved in the creation of information provided from other sources in this publication, and is not responsible or liable for its accuracy, completeness and content.”

Disclaimer: The views expressed in this bulletin are solely those of the authors and do not in any way represent the views of World FZO.

Table of contentsIntroductory Message 1

State of the art: Free Zones of the Americas 2

The Development of SMEs and 8Entrepreneurship in Free Zones: Advantages and Challenges - an overview

Latest Investments throughout the globe 12

Atlas of Free Zones - Egypt 28

© 2015 I World Free Zones Organization I Bulletin issue 04© 2015 I World Free Zones Organization I Bulletin issue 042 3© 2015 I World Free Zones Organization I Bulletin issue 04© 2015 I World Free Zones Organization I Bulletin issue 042 3

By Juan Pablo RiveraChairman Free Trade Zones Association of the Americas

STATE OF THE ART: Free Zones of the Americas

© 2015 I World Free Zones Organization I Bulletin issue 04© 2015 I World Free Zones Organization I Bulletin issue 044 5

1923Uruguay

1948Panama

1958Colombia

1965Mexico*

1967Brazil

1969Dom Republic

1973Chile

1976Honduras

1990Guatemala

1990Costa Rica

1991Nicaragua

1994Argentina

1995

1870 1890 1910 1930 1950 1970 1990 2010

Paraguay

Types of Free Zones in Latin American countries

There are three types of Free Zones classified in this way:

1. Export Free Zones: There are 3 different identifiable models:

• Industrial Diversification: They are used to increase the value added of goods and services produced in FZs. For example Costa Rica and Dominican Republic had a strong textile/apparel industry, but today they also produce high tech products such as electronics, medical devices and pharmaceuticals products.

• Dependence in “maquilas”: They are generally implemented in the textile/apparel sector in order to take advantages of the CAFTA-DR, in countries like El Salvador, Honduras, Guatemala and Nicaragua.

• Logistic Services: They are used exclusively for the

distribution of goods and services. This model is used in countries such as Panama, Chile, Argentina, and Uruguay.

2. Import Substitution Free Zones: These zones are located in Brazil and were implemented to help those looking for the supply of foreign goods on the domestic market.

3. Mixed Free Zones: This model operates in Colombia and Uruguay and they use three different types of FZs.

• Permanent: These Free Zones are specially designated by the government on geographical limited areas where economic incentives, on duties and taxes are offered exclusively.

• Special or single-company: Consist of special incentives that are exclusive for companies operating in the geographical area designated by the government for single companies that fulfill requirements in the place where they are operating.

• Transitory: Is the area where the government provides

authorization for holding international fairs, exhibits, congresses and seminars of importance for national economy and the international trade.

Map of Free Zones in the World12.7% of the FZs in the world is located in Latin America and the Caribbean.

Statistics of Free Zones in Latin American countriesThe first country to establish a Free Zone on its territory was Uruguay in 1923, followed by Panamá in 1948 and Colombia in 1958. It is interesting to note that a first wave of installation of the Free Zones model took place in the 60´s and 70´s in countries such as Mexico, Brazil, Chile and The Dominican Republic. A second wave took place in the 90´s in countries such as Guatemala, Costa Rica, Argentina, Paraguay and Nicaragua.

Graphic 1: Year of Establishment of the Free Zone Regime in Latin American countries

Source: Information Compiled by AZFA

Colombia is the Latin American nation that has the largest number of Free Zones in its territory, with 102 in total. Colombia is followed by Central American countries including The Dominican Republic with 55, Nicaragua with 49 and Honduras with 43. Countries such as Costa Rica, Guatemala, El Salvador and Panama also count within the regime but in a smaller proportion. Finally, Ecuador, Brazil, Paraguay and Chile have less than 3 FZs.

Graphic 2: Number of Free Zones in Latin American countries


In regard to employment generation, the Latin American Free Zones play a significant role in the national territories where they are localized because they provide jobs to a large number of people. Dominican Republic statistically offers the highest number of created jobs, specifically 153,300 in 2014. However, the average number of generated jobs is 69.000 and 70.000 for countries such as Colombia and Costa Rica, same countries that in the previous graph show a different number of Free Zones, so it can be concluded that the creation of jobs not only depends on the number of Free Zones, it also depends on other factors such as the diversification of activities into the Free Zone or the demands of domestic and international markets. On the other hand, countries such as Haiti and Paraguay have the lower number of created jobs with 7.000 and 2.500 respectively.

Graphic 3: Number of employment generated in Free Zones in Latin American countries


The largest number of companies operating under Free Zone regimes in Latin America are located in Chile, where there are 2,850 companies operating in the Free Zones named “ZonAustral” and “ZOFRI” that are characterized for having a high volume of trade in exports, principally because of their geographic location and advantageous economic incentives. Chile is followed by Uruguay and Colombia with 1,560 and 772 companies operating in their Free Zones respectively. Finally, there are countries with a lower number such as El Salvador, Nicaragua and Paraguay.

43.6% Asia

6.1% Asia

2.8% Middle East

6.2% Africa

14.9%North America

5.8%Central America

6.9%South America

Colombia

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140,000

160,000

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146,000

126,000

108,000

81,000

Dom. R

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ica

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70,73069,000

67,00048,000

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15,0007,0002,500

Free Zones in Latin American countries have been used for more than 90 years as instruments to attract Foreign Direct Investment, promote the creation of new jobs and to contribute towards national economic growth. These Free Zones usually provide attractive incentives on duties and taxes to foreign investors.

This article provides a general overview about Free Zones localized in the Latin American region, with references to the types of Free Zones that are available as well as statistics of generated employment, year of establishment, number of companies operating under the regime and the industrial diversification among them.


The following table shows the different economic incentives given by the Free Zones in Latin American countries, specifically regarding to income tax compared between the Free Zone and the national territory. Chile has the most beneficial regime for the companies operating in a Free Zone because they give a preferential tax of 0% compared with the 35% that a normal Chilean entrepreneur must pay in national territory. In a general overview we can affirm that more than 5 countries have a 0% income tax for companies operating in a Free Zone, which makes Latin America a very attractive place for foreign investors, these are Nicaragua, Guatemala, El Salvador, Honduras and Dominican Republic. Colombia and Costa Rica have income tax of 15% in their Free Zones Vs. a 25% and 30% in National territory.

Graphic 6: Incentives in Free Zones in Latin American countries Income TAX in Free Zones Vs National Territory in Latin American Countries

CountryIncome Tax Income Tax

FZ NT

Chile 0% 35%

Nicaragua 0% 30%

Guatemala 0% 25%

El Salvador 0% 25%

Honduras 0% 25%

República Domin-icana 0% 25%

Colombia 15% 25%+ 13%*

Costa Rica 15% 30%

Mexico 28% 30%

Source: Information Compiled by AZFA * Colombia applies an equity tax of 13% in addition to the income tax, FZs are exempted from such tax

Conclusions

• The Free Zones regime has existed in LATAM for more than 90 years and is an important tool in promoting investment, employment and economic welfare;

• Figures of FZs in LATAM are: approximately 400 FZs, 900,000 direct employees and more than 8,000 companies operating under the FZs scheme;

• FZs are used for different activities: Industry, manufacturing, logistics, commercial and services;

• There is an interesting industrial diversification into some of the FZs of Latin America;

• Countries and/or regions have established selective strategies differentials in terms of: types of companies, legal frameworks and incentives to attract investment into FZs;

• Free Zones are present all over the Latin American countries despite the different economic situations and political parties;

• FZs have helped incorporating and transferring technology to production processes and operations in the diversification of products;

• Due to the importance of FZs in the economic performance of the countries, Labours have been created at a national and regional level: ANDI (Colombia), CNZFE (Dominican Republic), ADOZONA (Dominican Republic), CNZF (Nicaragua), CNZF (Paraguay), AZOFRAP (Panamá), AZOFRAS (Costa Rica), AGEXPORT (Guatemala), CZFU (Uruguay), AZAFRANCAH (Honduras), CAMTEX (El Salvador) and AZFA (LATAM);

Free Trade Zones Association of the Americas (AZFA)AZFA is a non-profit Organization that in the regional context promotes and defends the FZ regime through integration, research and partnerships among the public and private sector in all countries of Latin America, and whose purpose is the correct development and understanding of the advantages of FZs.

The main objectives of the organization are:

• To promote the free zone regime in different Latin American countries.

• Associate and motivate cooperation and business relations among FZs, Associations, Governmental Agencies and other Organizations.

• To provide a platform to channel information that is both relevant and of value for the FZs sector.

Graphic 7: Affiliates to AZFA from 14 countries

• AZFA counts with affiliates from 14 different countries:– Argentina– Brazil– Colombia– Costa Rica– Spain– Guatemala– Honduras– Nicaragua– Panama– Paraguay– Puerto Rico– Dominican Republic– Uruguay– El Salvador

Today, AZFA has affiliates from 14 countries, including the Latin American countries and the Caribbean, Spain, being the most important Association of Free Zones in the region.

Graphic 4: Number of companies operating under Free Zone regimes in Latin American countries


With respect to the industrial diversification in the Free Zones in Latin American countries, we see a high diversification in countries such as Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Dominican Republic and Colombia, because in those countries the companies operating in their Free Zones have economical activities covering more than 4 different business sectors. However there are other countries with a low industrial diversification as a consequence of the lack of differential economic activities in their Free Zones such as Chile, Argentina, Paraguay, Brazil and Ecuador. It should be noted that the lack of industrial diversification is not bad per se because it may be caused by a specialization in some activity that provides the expected returns.

Graphic 5: Industrial Diversification in Free Zones in Latin American countries

Country Agri-Industry

TextilesApparel

MedicalDevices

Pharma-ceuticals

Elect-ronics

Auto-parts

CallCenters BPO Logistics

Guatemala D D D D D

El Salvador D D D D D

Honduras D D D D D

Nicaragua D D D D

Costa Rica D D D D D

Panama D

Rep. Dom. D D D D D D

Puerto Rico D D

Colombia D D D D D D D

Ecuador

Brazil D

Paraguay D D

Uruguay D D D D

Argentina D

Chile D


0

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1000

1500

2000

2500

3000

Chile

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Colombia

Puerto

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ica

Guatem

ala

Honduras

El Salv

ador

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Para

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2,850

1,560

772 731602

325 260 216 200 173 143


By Christin PfeifferSecretary General, INSME – International Network for Small and Medium Enterprises

The Development of SMEs and Entrepreneurship in Free Zones: Advantages and Challenges – an Overview


“Quality is not an act. It is a habit.” (Aristotle)Small and Medium enterprises are the backbone of most economies generating a huge part (normally around 66%) of the GDP of a country. By having a look at the European Economy this percentage raises incredibly: 99% of the companies are small and medium sized, while it is particularly relevant to keep in mind that from those 99% the vast majority (nine out of ten) are micro-entrepreneurs, being able to count on less than ten employees.

SMEs have often shown to be more flexible than large enterprises and might therefore adapt more easily to new conditions – a fundamental asset in times of worldwide economic crisis and uncertainty. As a further advantage, satellite companies to big multinationals are often able to react immediately and guarantee timely delivery to locally based industry compared to larger corporations.

SMEs are not only the economic backbone, but also the most important employment generators of the 21st Century – an aspect that is of paramount importance, given the social impact of this phenomenon. Free Zones today are creating a huge number of new jobs and as such linking both would create a win-win situation. By taking the trend on clustering into account, the employment generation aspect has to be considered even stronger, as very often the outcome is a creation of innovation hubs, collaborating fruitfully also with local universities and scientific knowledge providers, having a positive impact on local infrastructure and the territory.

With those few lines it seems evident that involving SMEs more actively in Free Zones would offer a variety of advantages. But there are also challenges to cope with for the people involved in designing the future policies, rules and procedures in managing a Free Zone.

Finding a common policy and supporting small companies to successfully comply with today’s conditions in a global competitive environment is a major difficulty. SMEs are an indisputable part of value chains, going beyond the traditional understanding of “supply chains”. The Free Zones might be a perfect place to cluster small companies and bring the value chain members together.

To clarify the understanding of value chain it is necessary to recall a proper definition: a value chain is a chain of activities that a firm performs in order to deliver a valuable product or service for the market. This concept was analyzed, first described and then popularized by Michael Porter in 1985.

The idea of value chains is based on seeing a manufacturing (or service) organization as a system, made up of subsystems each with inputs, transformation processes and outputs. “Inputs, transformation processes, and outputs involve the acquisition and consumption of resources - money, labor, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits”.1

In a global supply chain many partnering firms are normally small and medium sized enterprises supporting a focal firm in the process of supplying raw materials to the delivery of final products and services to end customers. In context to the supply chain of the focal firm, SMEs play “a very crucial role in attaining cost efficiencies in procurement and production processes, and accurate & timely delivery of products and services to the end customers. But this requires a close and trustworthy relationship between the focal firm and associated SMEs”.2 Therefore the concept of value chain goes beyond the traditional understanding of a mere supply chain.

As UNCTAD (United Nations Conference on Trade and Development) points out: “there are obstacles that affect SMEs’ ability to enter global value chains (GVCs) both in developed and developing countries.”3 These include: (a) the need to upgrade technology and innovation capacity; (b) the lack of adequate finance and human capital for this process; (c) the inability to meet standards and certification requirements; (d) the necessity to better manage intellectual assets, including the protection of intellectual property rights (IPRs) when appropriate; (e) the difficult bargaining position SMEs face with large contractors; and (f) the need for diversification to reduce dependence on one or a few customers.

Value chains today have not necessarily to be limited geographically and micro entrepreneurs (91% of European enterprises) already play a role of paramount importance. As nearly all products and services are “born global” and could serve a variety of markets, international partnerships, exchanges of opinions, market analysis and feasibility studies require global expertise, experience and knowledge. Other players of the Free Zones might have collected proper experiences and best practices and could therefore assist the small companies with precious advice.

A further challenge in this regard results from the fact that the SME community is a very heterogeneous one; SMEs are not the same and not all suitable and mature to act as added value for Free Zones.

Growth ambition, innovation opportunities’ awareness and loyal leadership skills to afford internationalization challenges are characteristics of a successful entrepreneur in a globalized competitive environment. The latest “Global Entrepreneurship Monitor” Report (GEM), issued in January 2015 mentioned four important entrepreneurial preconditions:

• Entrepreneurial Connections; • Awareness of Opportunities; • Inherent Entrepreneurial Skills; • Risk Taking Culture.4

This implicates that if there is intent to integrate SMEs successfully in Free Zones, a clear focus on skills development needs to be set to make sure the benefits can be achieved and managed properly.

All participants of the Free Zone Eco-System have to play their specific role and need to be involved to develop the Free Zone further, respond to the demands of internationalization and innovation attitudes. Therefore, in addition to the industry and SME Managers, also the financial participants have to be involved (public and private ones including venture capitalists etc.), as well as policy makers, public and private intermediaries and finally the knowledge providers (as universities and research centers). There has to be a strategic planning taking the differences in the short/medium/long-term visions of each other into account.

In addition new ways of collaboration and exploitation of technology have taken over the traditional ones: the virtual opportunities of engaging with each other might often be exploited better by small companies. SMEs need to learn more about user-driven innovation and shall take advantage of crowd thinking or crowd sourcing linked to the available open innovation tools. Collaboration in this “2.0 manner” leads to new ideas as well as to services, processes and business models innovation, which might reduce costs and time and improve quality of products delivery. Internationalization is a must today, skills and knowledge of how to market the proper value proposition globally require access to platforms, toolkits and a portfolio of services often already available and freely accessible to SMEs, who might just not be aware on how to benefit from them.

As an outcome Free Zones might attract more talent thanks to SMEs and the start-up community (that has to be strengthened especially in and around the Middle East) could notably benefit. More interaction between academic and industrial players is auspicious, as the investment in research with a user-driven approach might help to be able to finally commercialize the results of academic studies.

SMEs – as already mentioned – can attract talent and give space to young people to realize their dreams and work on a more sustainable future by fostering inclusive growth. Free Zones might be their perfect home and proper management of a Free Zone (like an innovation Eco-System) becomes a key priority. Especially if Free Zones act like clusters, it is of added value to upgrade and enrich the skills of the Free Zone Manager (leader) and create a homogeneous profile in this regard.

The mentioned benefits seem exactly in the interest of the whole innovation Eco-System and bring together all actors of the cycle. Especially the role of Human Capital becomes vital. According to Deloitte’s Annual Research on “Global Human Capital Trends”, people need to be managed in a different way and learn how to innovate and transform human capital. Twelve trends are described that can be split into three key areas of strategic focus: (1) Lead and Develop; (2) Attract and Engage and (3) Transform and Reinvent.5

International expert organizations as INSME are offering tailor-made trainings on actual trends of strategic networking, innovation management and innovation performance impact assessment for multipliers and intermediaries, creativity and pitching that can be extended to upgrade skills for Free Zone Managers.

Similar to Cluster Managers, it might be worth to brainstorm about a certification system or a quality label of Free Zone Managers focusing on and strongly working with SMEs.

There are diverse benchmarking facilities available to Cluster Managers that can be easily adapted to Free Zone Managers; an investment in this regard would also help to discuss certain issues on a Government level, as the investment in Entrepreneurship is currently part of most political agendas around the world. The same applies to Competitiveness, Innovation and R&D results exploitation as well as employment and inclusive growth.

As Free Zones are generating a massive and impressing number of work places, they shall definitely play their role and be integral part of the related discussions in the future.

1 “Decision Support Tools: Porter›s Value Chain” Cambridge University: Institute for Manufacturing (IfM) on http://www.ifm.eng.cam.ac.uk/research/dstools/value-chain- /. Retrieved 24 March 2015.

2 “Aligning interests of SMEs and a Focal Firm (MNE) in a Global Supply Chain Setup”, K.K. Morya and Dr. Harsh Dwivedi, abstract, page 1 under “SMEs and MNEs in Global Supply chain setup” on www.academia.edu. Retrieved 24 March 2015

3 “Enhancing the participation of small- and medium-sized enterprises in global value chains”, report 2007, page 8 on http://unctad.org/en/Docs/c3em31d2_en.pdf. Retrieved 24 March 2015

4 “Leveraging Entrepreneurial Ambition and Innovation: A Global Perspective on Entrepreneurship, Competitiveness and Development “, Global Entrepreneurship Monitor, Report 2015, Executive Summary, page 2 on http://www.weforum.org/reports/leveraging-entrepreneurial-ambition-and- innovation-global-perspective-entrepreneurship-compe. Retrieved 24 March 2015

5 “Global Human Capital Trends 2014: Engaging the 21st-century workforce”, Deloitte University Press, 2014, page 25 – 144 on http://www2.deloitte.com/global/en/pages/human-capital/articles/human-capital-trends-2014.html. Retrieved 24 March 2015


View from America

The Financial Times Limited, 2015. All Rights Reserved.


Much has been noted about friction being removed from global business operations. Supply chains have expanded: a product is designed in one place, its component parts are produced in many places and it is assembled in yet other places.A hallmark of the new Pacific Trade agreement (the Trans-Pacific Partnership) is to reduce barriers (i.e. take out the friction) to enable a similar expansion in delivery of business services.

A little over 14 years ago, at midnight, I sat at a Cape Cod, Massachusetts kitchen table and delivered a presentation via telephone to a gathering in Australia. My colleagues in Melbourne were happy to advance the slides, but they were also insistent that I give the talk and handle the question-and-answer section. Flights were cancelled in the aftermath of the 9/11 attacks, so we needed to work around this friction. Obviously, others were confronted by far more severe outcomes, but all were affected and still are.

In addition to what others do to us, friction also stems from what we do to ourselves. Consider corporate tax and regimes and their impact on strategic and tactical business decisions, including FDI. Remarkably, we should have it within our power to rework these to advantage. Sadly, we seldom do.

And, when programs are developed to create competitive advantage, things don’t always work out. To overcome ‘friction’ of skilled labour shortages, the US enacted the H-1B Visa program. It seemed a great idea. The US can brain drain the world to win the war for talent, and assure that our most innovative companies are able to get the staff they need but cannot find. However, the reality is that most of the visa recipients are headed to just a handful of global outsourcing firms, and, with a political backlash developing, a thoroughly positive redesign is not assured. Frictions addressed can lead to frictions created; friction is not quite removed.

Daniel Malachuk works with business and government leader on global direct investment strategies. He had advised many of the world’s leading companies and served in the public sector as director of White House operations.

Email: [email protected]

Latest InvestmentsAutomotive Components

Pioneer to create Mexican jobs

Pioneer Electronics Mexico, a subsidiary of Japan-based Pioneer, is to open a $4m plant in Bajio, Mexico. Pioneer Automotive de Mexico will have a production capacity of 2 million car electronic products per year. It will serve Mexico as well as North, South and Central America. The subsidiary will be established in February 2016, and will commence operations in February 2017. It will increase employee numbers from an original base of 47 to 450 by 2019.

Automotive OEM

New Toyota Facility in Mexico

Toyota, a subsidiary of Japan-based automobile manufacturer Toyota Motor, plans to establish a new manufacturing facility in Guanajuato, Mexico by 2019. It will have an annual capacity of 200,000 units and will be dedicated to the production of the Corolla sedan for the North American market. The company will create 2000 jobs. The project forms part of a wider $1.3bn investment plan, which will also see an additional plant established in Guangzhou, China in 2018.

Consumer Electronics

Samsung invests in Argentina

Samsung Electronics, a subsidiary of South Korea-based conglomerate Samsung, is to invest $65m to manufacture refrigerators in Argentina. The company will create 300 direct and 300 indirect jobs.

Industrial Machinery, Equipment & Tools

Dunan opens in Tennessee

Dunan Environmental, a manufacturer of commercial and residential central air-conditioners, which operates as a subsidiary of China-based Dunan, is to open a manufacturing facility in Memphis, Tennessee, US. The facility, Dunan Precision, will manufacture heat exchangers for air conditioning and refrigeration units to be sold in North America. The move is expected to occur in early 2016, and will create 104 jobs.

Metals

Constellium invests in Georgia

France-based aluminium processing company Constellium is to open a manufacturing facility for automotive structures in Bartow County, Georgia. The company will invest $20m on the 7805-square-metre (sq m) facility, which may be expanded up to 20,440 sq m. The project is expected to create 150 jobs, and will open in 2017.

Software & IT Services

Onomatics expands in NYC

Finland-based Onomatics, which provides Trademark Now, an intelligent web-based trademark management platform provider, has expanded its operations in New York City, US. The firm has relocated to a larger office on East 28th Street in the heart of Silicon Valley in response to its expanding US client base. The new office will accommodate the company’s planned growth in 2016.


View from Asia



Asian Millennials (aka Generation Y) are the next key Asia market driver.US consultancy McKinsey & Co has identified five Asian Millennial segments. The younger segments – the ‘idealists’ (19%) and ‘want-it-alls’ (13%) – are more likely to be motivated by factors such as meaningful work, whereas older segments – the ‘money seekers’ (18%), the ‘family-focused’ (18%) and the ‘breadwinners’ (32%) – tend to place greater value on more practical financial and lifestyle factors.

Research by multinational financial services corporation MasterCard revealed that by 2020, 60% of the world’s Millennials perceive themselves to have less disposable income than any other age group, they save more and are cautious spenders. Of all generations, they are the most likely to do their research by looking for more brand connections, ‘word of mouth’ recommendations and reviews online from social media influencers before purchasing an item, with electronic gadgets and travel being their top two purchases. With increasing property prices, they feel that property ownership is out of their reach and prioritise their spending on experiences.

Even in the workplace, Asian Millennial employees will soon dominate. Already, 44% hold management positions. By 2025, three out of four workers globally will be Millennials. Millennials are often highly ambitions and impatient for accelerated career advancements, where career progression is the single most important factor for selecting a job.

Identifying the target Asian Millennial segment is critical, then researching, formulating and executing a Millennial segment strategy is next. It is a major challenge. Amid the converging technology products with difference social media platforms, how will businesses serve these evolving, diverging Asian Millennial segments? I am glad to witness this new wave as I turn fabulous 50 next year!

Lawrence Yeo is CEO if AsiaBIZ Strategy, a Singapore-based consultancy that provides Asia market research and investment/trade promotion services.


Latest InvestmentsAlternative/Renewable Energy

Apple invests in Chinese Solar

US-based Apple plans to develop a 50 megawatt photovoltaic power station in Sunit, Inner Mongolia, China. The company is partnering with China-based Zhonghuan Semiconductor and a US-based photovoltaic company, with about Rmb181m ($28.3m) to be invested. Apple will account for 40% of the investment in the project, which represents part of a plan, recently announced by the company, to make its Chinese supply chain more environmentally friendly.

Business Services

New Office in Singapore

Communispond, a subsidiary of UK-based Informa, has opened a new office in Singapore. The office will support the company’s global presence and will manage business for Singapore, Malaysia, Indonesia and Vietnam. The new office will add to the company’s 11 existing offices.

Communications

NTT expands its Hong Kong Data Centre

NTT Communications, a subsidiary of Japan-based Nippon Telegraph & Telephone, has expanded its data centre in Hong Kong, as part of an ICT and internet infrastructure project. The expansion has added 4000 racks of server space to the existing centre, and improved energy efficiency by 20%.

Electronic Components

Foxconn opens base in Lanzhou

Foxconn, a subsidiary of Taiwan- based Hon Hai Precision Industry, has entered into an agreement with Gansu Radio and Television Network to establish a joint electronics processing base in Lanzhou, China. The processing base will focus on a combination of new IT, such as cloud computing and big data, as well as areas such as manufacturing and productive services.

Rubbers

Germany’s Lanxess expands global production

The Rhein Chemie Additives business unit of Germany-based Lanxess, a chemical company, has opened a production line for rhenoshape tyre curing bladders at its site in Qingdao, China. The company will expand its global production capacity by about 10%. The firm serves tyre manufacturers in China and other Asian countries, including Japan, Thailand and Malaysia.

Semiconductor

Avago expands in Malaysia

Avago Technologies (Malaysia), a subsidiary of Singapore-based Avago Technologies, a supplier of semiconductor devices, plans to expand its operations in Bayan Lepas, Malaysia. It will invest $20m to add a new 4645-square-metre building at its existing premises, which will feature design and development laboratories, offices and a conference room. The expansion will create 270 jobs.



View from Europe


As from 2014, the working-age population of Europe has been shrinking, and is expected to continue to decline until 2050. People aged 80-plus are now Europe’s fastest growing population segment. So, as Europe grows older, what does this mean for those know as Generation Y (in Europe, generally considered to be people born between 1980 and 2000)?

Generation Y, also known as Millennials, are a much studied demographic group, and are continually under the scrutiny of social and economic scientists because of their importance as a consumer market and their current (and future) contributions to the workforce. By 2020, Millennials will comprise half the global workforce. In Europe, they currently account for about 33% of it, and by 2025 they will account for 47% of the European workforce.

There is a duality to Europe’s Millenials. While the demography boffins have classified them as well-educated, multi-lingual, mobile and confident, many are still living with their parents, are unemployed or on low wages, and are anxious about their future. With many coming into the labour force after 2007, all they have known are recessionary times.

Notwithstanding this sweeping stereotyping about an entire generation, there is one big important and positive attribute about Europe’s young. It is their comfort with technology. They have grown up with internet and with their trusty smartphone in hand, they are connected on a daily basis to all sorts of technology. Online for an average of five hours per day, technology is central to their lives. This is good, for if ageing Europe is to continue to be productive and competitive, then it will need to harness technology. It will have to be smart. With the European Commission’s ‘digital agenda’ being one of the seven pillars of the Europe 2020 Strategy, the people in power need to make sure that Generation Y is given the opportunity to play it full part in helping to shape the continent’s future.

Douglas Clark is director of Location Connections, a site selection and FDI consultancy.


Latest InvestmentsAerospace

Terma to develop logistics Centre in the Netherlands

Defence and security company Terma, a subsidiary of Denmark- based Thomas B Thriges Fond, has signed a Letter Of Intent with the Royal Netherlands Air Force to establish a centre of excellence logistics centre at the Woensdrecht airbase in the Netherlands. The firm is one of five companies to sign the agreement with Fokker Services, Nedaero, NLR and Thales also participating. The facility will support the F-35 fighter jet programme with specific focus on the LM-STAR, performance-based logistics software, test capabilities and mainte- nance repair overhaul. The new site will also allow the firms to maintain their presence in the Netherlands and increase industrial participation in the programme.

Chemicals

Linde Gas opens $15m facility in Turkey

Linde Gas, a subsidiary of Germany- based chemicals company Linde, has opened a new $15m carbon dioxide (CO2) production facility in Denizli, Turkey. The plant has the capacity for 240 tonnes per day and sources its CO2 from emissions from the nearby Zorlu Energy geothermal power plant. The facility features pipeline infrastructure connected to the Organised Greenhousing Zone in the region, though the majority of gas will be sold to local food and beverage clients..

Food and Tobacco

Moy Park expanding in the UK

Poultry processing company Moy Park, a subsidiary of Brazil-based Marfrig, is set to expand operations at its hatchery and processing plant in Ashbourne, the UK. The company will invest $15m in the installation of a new cutting line, processing equipment and refrigeration chilling technology. This will enable the company to increase its capacity to more than 1 million birds a week. It will also increase the hatchery’s capacity to 1.2 million chicks a week. The investment will create 100 new jobs.

Non-Automotive Transport OEM

Honda expands motorcycle facility in Spain

Montesa Honda, a motorcycles manufacturer and a subsidiary of Japan- based Honda, is to invest $3.51m to expand its facility in Santa Perpètua de Mogoda, Spain. The company will manufacture a new 4RIDE model for a wider audience.

Plastics

Australian’s Amcor create 100 jobs in Poland

Australia-based Amcor, a food and beverage packaging manufacturer, has expanded its production facility in Lodz, Poland. The plant now totals 25,000-square-metres and will produce a wide range of paper packaging products for the tobacco industry. The expansion has created 100 new jobs,bringing the total headcount at the site to 500.



View from Middle East & Africa


There is something mystical about the name Millennials compared with the Baby Boomers or the ‘flower power’ generation, which implies that people born in the past two decades are somewhat special. But a closer look at history and relevant studies in Millennials shows that these young people have the same dreams and ambitions as their parents and grandparents when they were young: break existing boundaries, be free in their choices, and change the status quo in the name of equality, justice and freedom.

Therefore, the difference in this eternal fight between ‘the young’ and ‘the ruling’ lays not in the goals but in the measures and the technological possibilities of the young generation today compare to the past centuries. The endless possibilities of the internet, the global reach of social media and the ease of travelling around the globe in a short time give Millennials the possibility to be active, reach their audience and mobilise their peers more effectively than any generation before.

They can attract attention to politics in Gaza from San Francisco, like the founder of all-digital news channel AJ+ Dana Takruri; or develop an impressive renewable energy initiative for a multinational corporation in east Africa, like entrepreneur Patrick Ngowi. They are well educated, often multilingual with close ties to different cultures, and quite entrepreneurial in their approaches towards changing the status quo of their neighbourhood, country or regions.

All these aspects are important cornerstones for an economy in search of foreign investment. However, it all comes back again to the same historical question: will those in power today create a peaceful framework for young to build upon? After all, all those positive characteristics are useless without stability and peace.

Mazdak Rafaty is managing partner of Ludwar International Consultancy and SME advisor to the joint Emirati-German Chamber of Commerce.


Latest InvestmentsAlternative/Renewable Energy

Norway’s scatec to build solar facilities in Egypt

Scatec Solar, a subsidiary of Norway- based Scatec, plans to establish three solar generation facilities in Aswan, Benban, Egypt. The development is part of a wider $600m growth initiative, which will see two facilities established in Zaafarana. The Benban projects are set to be launched in the first half of 2016.

Building & Construction Materials

Dangote creates 1300 jobs

Dangote Cement, a subsidiary of Nigeria-based construction materials company Dangote Group, plans to open a new factory in Mugher, Ethiopia. The $450m development is expected to double the site’s capacity to 5 million tonnes per annum. The plant, which is to be situated near to an existing factory, will encompass 560,000-square-metres and create 1300 jobs. The cement produced will be distributed in Ethiopia and exported to neighbouring countries.

Business Services

Aegis opens new call centre in Durban, South Africa

Aegis Limited, an outsourcing services partner and a subsidiary of India-based Essar Group, plans to establish a new call centre in Durban, South Africa. The facility is expected to be able to accommodate 500 members of staff.

Chemicals

France’s Sodamco to build plant in Saudi Arabia

Sodamco, a subsidiary of France- based Saint-Gobain, plans to establish a new manufacturing plant in King Abdullah Economic City, Saudi Arabia. Expected to become opera- tional in 2017, the plant will provide adhesives and construction chemicals destined for Saudi Arabia and markets in east Africa.

Food & Tobacco

Skretting expands Egypt operation

Skretting, a producer of feed for farmed fishes and shrimps and a subsidiary of Netherlands-based Nutreco, has expanded operations at its plant in Bilbeis, Egypt. The firm has invested in an extra produc-tion line to triple its tilapia fish feed capacity in Egypt to 150,000 tonnes. The extra capacity allows Skretting to better serve the local tilapia sector with fish feed as well as technical expertise and support.

Metals

Strong structural steel plans new Nigerian plant

US-based Strong Structural Steel, a steel product and architectural steel manufacturer, plans to establish a plant in Nigeria. The $36m factory aims to bring the firm’s expertise to the domestic market, and will create 300 jobs when opened in May 2017. The development is expected to be a joint venture initiative with the Nigerian government or a local entity.

This investment news and data has been provided by fDi Markets, a crossborder investment tracking service that is part of The Financial Times Ltd’s fDi Intelligence division (www.fdiintelligence.com)


World Free Zones Organization Atlas of Free Zones in Egypt

Compiled by the University of Reims, FranceConception: F. BostData collected by D. MessaoudiMap and layout: S. Piantoni


Official Terms for Free Zones-Free zones-Qualifying Industrial Zones (QIZ)-Special Economic Zones (SEZ)

Exact number of Free Zones-10 public free zones (since 1997)-15 Qualifying Industrial Zones (since 2004)-2 Special Economic Zones (since 2002)

Year of promulgation of the first text of law concerning the Free Zones 1975 (Policy of “Opening the Door”)

Qeft PublicFree Zone

Suez PublicFree ZoneMedia Public

Free Zone

Damietta PublicFree Zone

Ismailia Public Free Zone

Port Said PublicFree Zone

Alexandria Public Free Zone

Suez Economic andTrade Cooperation

Port Said East Port Public Free Zone

Economic ZoneNorthwest Gulf of Suez

Shibin el KomPublic Free Zone Nasr City Public

Free Zone

Qeft PublicFree Zone

Suez PublicFree ZoneMedia Public

Free Zone

Damietta PublicFree Zone

Ismailia Public Free Zone

Port Said PublicFree Zone


Suez Economic andTrade Cooperation


Economic ZoneNorthwest Gulf of Suez

Shibin el KomPublic Free Zone Nasr City Public

Free Zone

Alexandria Dumyat

Suez

Ismailia

Cairo

Al Jizah

El Faiyum

Asyut

Abu Zenima

Sohag

Qena

Port Said

Alexandria Dumyat

Suez

Ismailia

Cairo

Al Jizah

El Faiyum

Asyut

Abu Zenima

Sohag

Qena

Port Said

50 km

Egypt

Sudan

Jordan

SaudiArabia

Syria

Israel

Libya

Lebanon

WestBankGaza

Strip

Marsa

Matruh

Alexandria

Dumyat

Suez

Ismailia

Cairo

Al Jizah

Asyut

Abu

Zenima

El Tur

Al Ghurdaqah

Sohag

El-Kharga

Aswan

Wadi Halfa

Qena

Port Said

Egypt

Sudan

Jordan

SaudiArabia

Syria

Israel

Libya

Lebanon

WestBankGaza

Strip

Marsa

Matruh

Alexandria

Dumyat

Suez

Ismailia

Cairo

Al Jizah

Asyut

Abu

Zenima

El Tur

Al Ghurdaqah

Sohag

El-Kharga

Aswan

Wadi Halfa

Qena

Port Said

200 km

International bordersMain roadsMain riversMain cities

200

0

500

1000

elevations(meters)

Public Free Zones

Alexandria

Central Delta

Suez Canal

Greater Cairo

Beni Suief

Al-Minya

Special Economic Zones (SEZ)

Qualifying Industrial Zones (QIZ)

Free Zones in Egypt

© Sébastien PiantoniConception: François BostEA 2076 HabiterUniversity of Reims - 2015Map Projection: WGS 1984

Free ZonesGeneral information

Number of active companiesin Free Zones

-Free Zones : no information-QIZ : 680 companies in 2010-Special Economic Zones : no information

Main sectors of activity Food processing alimentary industries and food products, chemicals & petrochemicals industries, fertilizers, petroleum services, and natural gas industrialization and liquefaction, engineering and electronics industries, manufacturing of medical equipment, pharmaceutical industries and medical equipment, spinning and weaving, fabrics, readymade garments, ready-made clothes, leather and leather products, petroleum services and petroleum equipment leasing, Ships, yachts and fishing boats industry, navigation services, ship supplying and provisioning.

Total job numbers -Free Zones : no information-280 000 in 2014 in QIZ-Special Economic Zones : no information

Distribution of investors Europe economic zones : an Union, United States, Middle East countries

Exports and sales In 2013, the Egyptian free zones accounted for 10 billion dollars in annual exports, representing a quarter of the industrial exports of Egypt

Free zones contribution to the national economy

5% of total FDI in the country

Corporate Tax Companies operating in free zones are exempted from customs duties, sales taxes or taxes and fees on capital assets and intermediate goods

Free Zone law http://www.gafi.gov.eg/content/EN/macro/investmentlawno8en.pdf

Contacts

General AuthorityGeneral Authority For Investment and Free Zones3 Salah Salem st, Nasr City, Cairo, P.o. Box 11562, Egypt.Tel.: + 202 24055464Fax: +202 24055429

Free Zones SectorEl Sefarat District, Nasr City, Cairo, P.o. Box 8044, Egypt.Tel.: + 202 22748493Fax: + 202 [email protected]


List of Free ZonesName Location Surface area Observations / Contact


Situated at 220 km from Cairo, 20 km from Nozha International Airport, Borg El-Arab Airport, Alexandria port and located at the center of a network of roads. Alexandria Public free zone is at 7 km from Dekheila Port.

5 700 000 m² Ameriyah- Alexandria/ Cairo desert roadP.O.Box: 2351 AlexandriaTelephone: (+203) 4500002 / 4500011Fax: (+203) 4500010 / 4500012E-mail: [email protected]

Nasr City Public Free Zone

Located within Cairo governorate in the vicinity of Cairo Airport. Connected through a network of roads and railroads in the vicinity of Cairo airport (15 km).

705 000 m² Industrial activity represents 90% of the zone’s projects.Nasr City Public Free Zone:Nasr city- El-Safarat district behind El-WafaaWal AmalP.O.Box: 8044 CairoTelephone: (+202) 22748129Fax: (+202) 22748467E-mail: [email protected]

Port Said Public Free Zone

Located near Port Said Port. 160 km from Cairo

729 000 m² Port-Said Public Free Zone Port-Said CityP.O.Box: 242 Port-SaidTelephone: (+2066) 3729752Fax : (+2066) 3728724E-mail: [email protected]

Suez Public Free Zone

Established in 1975 on two locations: Port Tewfik location (an area of 75660 m²), adjacent to Suez port’s fence. Adabeyalocation (an area of 247208 m²) overlooking Suez bay coast at 5 km distance from Adabeya Port. 120 km from Cairo

75 660 m² + 247208 m²

Port-Said Public Free Zone Port-Said CityP.O.Box: 242 Port-SaidTelephone: (+2066) 3729752Fax : (+2066) 3728724E-mail: [email protected]

Ismailia Public FreeZone

Situated at Cairo/Port Said Desert Road. It’s 30 km away from Mubarak’s El-Salam Bridgecrosses over Suez Canal to the continent of Asia, it is located near the ports (85km fromPort Said port, and Suez Port, 120 km from Cairo Airport and 125 km from Damietta Port.The Free Zone is located near the first and second industrial parks, and near the Technology Valley.

325 000 m² Ismailia Public Free ZoneIsmailia/Port-Said desert road, Ezz-El-DinIsmailiaP.O. Box: 121, IsmailiaTelephone: (+2064) 3482870Fax : (+2064) 3482869E-mail: [email protected]

Damietta Public Free Zone

220 km from Cairo. 55km West of Port Said’s port

798 000 m² Damietta Public Free Zone Damietta, East of Damietta PortP.O. Box: 191Telephone: (+2057) 290140Fax : (+2057) 292222E-mail: [email protected]

Media Public Free Zone

40 km from Cairo 3 000 000 m²

Shebin El-Kom Public Free Zone

70 km far from Cairo 84 000 m² + 200000 m² (situatedon 20 feddansarea as a firstphase (84 thousandm²), to beextended to 48feddans on itssecond phase)

Shibin El-Kom Public Free ZoneInside Misr / Shebin spinning and weavingCompanyTelephone: (+2048) 2236946Fax : (+2048) 2236986Email: [email protected]

Qeft Public Free Zone

45 km from Luxor city, 180 km from El- Quseir Port, 250 km from Safaga Port, 650 km far from Cairo

905 000 m² Qeft Public Free ZoneIndustrial Park – Kallahein – Qeft – Qena GovernorateAdministrative headquarters: Tahrir Street-Extension of Elmohafza Street- In front of theCourts of the State Council.Telephone: (+2096) 5347482Fax : (+2096) 5347483E-mail: [email protected]


35 400 000 m² Established in 1995, focused on containers and transit activities, its borders were adjusted in 2003 to be parallel to the borders of the pivotal Port Said East port.An intermediate location between the international trade lines makes it an important distribution and logistic business center, serving the entire Mediterranean area and neighboring regions.A good potential of industrial integrationand commodities exchange with the adjacentindustrial zones and its projects.Port Said authority port is the one entitledto implement basic infrastructure facilities.It accomplished the implementation of new entry canal streaming directly from the sea, inaddition to the establishment of a containers (dock).The Suez Canal for Containers Company, has built a container station according to the B.O.T system, with a capacity of 600 thousand containers yearly, estimated to leach 1.2 million containers in the next few years.

Free Zones Web sites selection• http://www.tpegypt.gov.eg/Eng/FreeZone.aspx• http:www.gafinet.org• http://www.tpegypt.gov.eg/Eng/FreeZone.aspx• https://www.kpmg.com/EG/en/issuesandinsights/Documents/Issues-Insights%20PDFs/Doing%20Business%20in%20Egypt.pdf


Protocol Between Egypt and IsraelProtocol between the government of the arab republic of Egypt and between the government of the state of Israel on qualifying industrial zones : http://www.mfti.gov.eg/english/Agreements/qiz.htm

QIZ Web sites selection• http://www.qizegypt.gov.eg/• http://196.205.98.231/About_QualifiedLocations.aspx• http://www.moit.gov.il/NR/exeres/2124E799-4876-40EF-

831C-6410830D8F02.htm• http://www.mfti.gov.eg/english/Agreements/qiz.htm• http://itrade.gov.il/us-dc/2013/04/19/qizs-boost-egyptian-

exports-to-the-u-s-124-growth-since-2004/

Special Economic Zones (SEZ)There are two Special Economic zones (SEZ) in Egypt:• Economic Zone Northwest Gulf of Suez (SEZONE)• Suez Economic and Trade Cooperation (SETC)

Economic Zone Northwest Gulf of Suez (SEZONE)The first Special Economic Zone (SEZ) established in Egypt by law 83 of 2002 for Economic zone of special nature, is located in Ein El Sokhna - Egypt, infront of Ein El Sokhna Port, near the southern entrance to the Suez Canal. The land area earmarked for the SEZONE 1st phase is approximately 20.4 km2.

It is an experimental Zone for opening up and carrying out reform, establishing and improving the structure of the market economy in Egypt.

The development of SEZONE is intended to provide an attractive environment for medium and light industries as well as logistics services, thus enhancing economic activity in the region and creating new employment opportunities.

Development Objectives:

1. Establish and develop the North West Gulf of Suez Economic Zone according to the highest International standards.

2. Attract foreign direct investments to the Zone for the purpose of establishing industrial and service projects capable of competing with their counterparts regionally and internationally.

3. Direct employment creation, labor skills upgrade, and income generation.

4. Increase Egypt’s share in the international trade.5. Increase exports, not only in terms of accelerating export

growth, but export diversification as well.

Qualifying Industrial Zones (QIZ)Qualifying Industrial Zones (QIZ) are designated geographic areas, within Egypt, that enjoy a duty free status with the United States. Companies located within such zones are granted duty free access to the US markets, provided that they satisfy the agreed upon Israeli component, as per the pre-defined rules of origin.

Duty Free Market Access: Egypt is one of a few countries which can promise duty free access to the US, the world’s largest consumer market, for all products manufactured in its Qualifying Industrial Zones (QIZ) provided that they comply with the rules of origin requirements as specified in the Protocol. The tariff exemption applies to all products, regardless of the industry or whether they are produced by the public or private sector, and irrespective of the size and volume of the enterprise.

Egypt also provides competitive duty free access to several other substantial markets such as the European Union (EU), other Arab Countries, the Common Market of Eastern and Southern Africa (COMESA) countries, and Turkey. As a result, companies operating have competitive access to virtually all major commercial markets.

Simple and Flexible Requirements: As per the rules of origin, manufacturers must ensure that 35% of the product’s value be manufactured in an Egyptian QIZ, of which a minimum of 10.5% must be Israeli inputs.

Forteen currently designated industrial zones, with nearly 700 qualified companies, and more qualifying each quarter, amounting to more than $1 billion annual revenues.

The Protocol provides flexibility by monitoring the commitment of manufacturers to the agreed upon ratio of their manufactured products on a quarterly basis, not on a single shipment basis, hence giving them a wider time frame.

No Export Quotas: Exports are neither limited by minimum/maximum quotas on quantities, nor by seasonal requirements.

Open-ended Validity of the Protocol: The Protocol is not time-limited, nor does it have a preset end date.

http://www.qizegypt.gov.eg/About_QizAdvantages.aspxto more than $1 billion annual revenues.

Main sectors of activity Textiles & garments, animal products, articles of stone, Base metals, Chemical products, Electrical equipment, Footwear and headgear, Leather products, Machinery equipment, Paper products, Plastic products, Prepared food stuff, Vegetable products.

Number of active companies 700 companies entitled to QIZ Duty-Free Treatment in 2013

QIZ Total job numbers 280 000 in 2014

Exports and sales In 2013, the Egyptian free zones accounted for 10 billion dollars in annual exports, representing a quarter of the industrial exports of EgyptQualifying Industrial Zone program spurred $823.6 million in Egyptian exports to US in 2013

The Qualifying Industrial Zones (QIZ) are spread out on four large geographical regions.

Name Include

Alexandria

Greater Cairo Area Nasr City, Shoubra El Kheima, South Giza, 15th of May, 10th of Ramadan , 6th of October, El Obour, Badr City, Giza, Kalioub, Gesr Al Suez, Other areas in Cairo

Middle Delta Governorates Ismailia, Port Said, Suze

Suez Canal Area

Beni Suif

Al Minya

Incentives and Benefits:

SEZONE presents unrivaled incentives & guarantees comparing to the other economic zones in the region:1. 10% unified income tax in the SEZONE (versus 20% outside

of SEZONE) applicable on the profit of the capital companies and on income of natural persons and on revenues derived from land and non residential buildings.

2. 5% income tax. (versus 10% - 20% outside the SEZONE)3. A one-stop shop through legislation that provides the body

with single-point authority over other government agencies in core areas.

4. The Authority has a supreme committee that supervises the taxation system in SEZONE.

5. The Authority has a special customs service under the supervision of a Supreme customs committee.

6. Lowest cost production center in the Middle East-North Africa in many sectors.

7. Allowing enterprises access to the domestic market, duties on sales to domestic market will be assessed on the value of imported inputs only.

8. Access to productive skilled Egyptian labor in a number of manufacturing sectors at competitive costs.

9. Except for those submissions laying within the jurisdiction of the Summary courts and requests to revoke administrative decisions accompanied by submissions to suspend their enforcement, the dispute shall only be referred to court after having been submitted to the Dispute Settlement Center and that the panel has rendered its decision or after 60 days from the date a motion was filed to appeal the decision and the panel did not decide the appeal.

Targeted Cluster’s: SEZONE Authority aims to develop proposed industries on a «Cluster Based Policy». This will enable specified industries to achieve more productivity, efficiency in terms of time management and operating costs, innovation through establishing R&D centers, and new business formation by filling in niches and expanding the boundaries of the cluster map. It will also improve access of local SME’s to the international market and increasing their productivity.

• Automotive Assembly and Components.• Chemicals and Petrochemicals.• Construction and Building Materials.• Textile and Readymade Garments.• Agribusiness and Food Processing.• Home Appliances and Electronics.• Logistics and Warehousing.• Pharmaceuticals.

Contact:K.M. 114, Kattameya old road, Ain Sokhna, Suez - EgyptTel. : +2 062 3590004/7Fax : +2 062 3590003E-mail: [email protected]: www.SEZONE.gov.eg

QIZ Advantages (Ministry of Trade and Industry)


Suez Economic and Trade Cooperation (SETC)Since 2008, on the model of Tianjin SEZ (China). 10 km². 58 entreprises & 2 000 employeesLocation: 3rd sector, North-west Gulf of Suez Economic Zone, Ain Sokhna, Suez, Egypt.Nearby cities: Badr City, Kerdasa, KatiaCoordinates: 29°40’11”N 32°18’51”E

Contacts:[email protected]

[email protected]

Other information about SEZSpecial Economic Zone law:

http://www1.umn.edu/humanrts/research/Egypt/Special Economic Zones Law No_ 83 of 2002.pd

SEZ Web sites selection:

• http://www.sezone-egypt.com/ http://www.gafi.gov.eg/English/StartaBusiness/InvestmentZones/Pages/Special-Economic-Zones.aspx

• https://www.kpmg.com/EG/en/issuesandinsights/Documents/Issues-Insights%20PDFs/Doing%20Business% 20in%20Egypt.pdf

• http://www.ccs.org.za/wp-content/uploads/2013/08/CCS_DP_China_Goes_Global_Emma_Scott_2013_Final1.pdf

BibliographyAWNI Ali, SHAFEI Karim, (2012) “Beyond duty free access: export readiness assessment for Qualifying Industrial Zones (QIZ) apparel companies, Measuring Business “Excellence, Vol. 16 Iss: 3, pp.3-16

AZMEH Shamel. Labour in global production networks: workers in the qualifying industrial zones (QIZs) of Egypt and Jordan. Global Networks, Volume 14, Issue 4, October 2014, pp. 495-513.

BOOZ Allen Hamilton (2008), The Rise of Economic Zones in the MENA Region: A Telecommunications Perspective.

BRUYAS Frédérique (2000). “Port Saïd (Egypte), lieu d’articulation du local au mondial. Zone et ville franche : questions d’échelles”. Annales de géographie, n° 612, p. 152-171.

HANDOUSSA Heba, (1990), Egypt’s Investment Strategy, Policies and Performance Since the Infitah, in : Said El-Naggar (éd.), Investment Policies in the Arab Countries, papers presented at a seminar held in Kuwait, December 11-13, 1989 (International Monetary Fund), Washington, D.C, p. 143 ets.

Foreign Investment Advisory Service (2008), “Special Economic Zones: Performance, Lessons Learned, andImplications for Zone Development”. 7

SCOTT Emma. China goes global in Egypt: Special Economic Sone in Suez. Discussion Paper. Stellenbosch, August 2013, 36 p. - http://www.ccs.org.za/wp-content/uploads/2013/08/CCS_DP_China_Goes_Global_ Emma_Scott_2013_Final1.pdf

YADAV Vikash (march 2007). “The Political Economy of the Egyptian-Israeli QIZ trade Agreement”. Middle East Review of International Affairs, vol. 11, n°. 1, p. 74-96.

Table 2: Distribution of Firms Registered in QIZ in 2008

SectorNumber of Firms

Animal products 2

Articles of Stone 12

Base metals 14

Chemical products 13

Electrical equipment 8

Footwear and headgear 14

Furniture 9

Leather products 7

Machinery equipment 8

Paper products 1

Plastic products 14

Prepared food stuff 26

Stationery 2

Vegetable products 18

Ready-made-garments and textiles 585Total 733

Source: QIZ Unit, Ministry of Trade and Industry

Table 1: Qualifying Industrial Zone: Exports and Imports Value From 22/2/2005 until 31/12/2013 (Value in Million US$)

Textile & RMGExports Value Products

Food Value ExportsProducts

Total Exports Value Total Imports Value

2005 288,3 0,207 288,6 36,0

2006 636,2 1,259 637,5 73,7

2007 688,3 0,553 688,8 80,4

2008 743,7 0,954 744,7 78,6

2009 761,5 2,266 763,5 80,5

2010 855,7 2,508 858,2 90,4

2011 924,1 7,511 931,6 97,5

2012 880,6 4,1 884,7 93,0

2013 820 3,2 823,6 77,7Total 6 597 22,6 6 620,5 707,6

http://www.qizegypt.gov.eg/QIZ_Data.aspx

Graphic 1: Egyptian exports to the United States

$0

$0

$200

$400

$600

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2008 2009 2010 2011

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2008 2009 2010 2011 2012

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$3,500

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Other

Textile andApparel

NoProgram

U.S. Imports from Egypt 2008-2012 by Import Programin million of U.S. dollars

Composition of QIZ Imports 2008-2012 in million of U.S. dollars

$0

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NoProgram

U.S. Imports from Egypt 2008-2012 by Import Programin million of U.S. dollars

Composition of QIZ Imports 2008-2012 in million of U.S. dollars

http://itrade.gov.il/us-dc/2013/04/19/qizs-boost-egyptian-exports-to-the-u-s-124-growth-since-2004/*GSP: Generalized System of Preferences

Appendices

© 2015 I World Free Zones Organization I Bulletin issue 0438

9-11 May 2016Dubai, UAE

Free Zone Outlook2nd Annual International Conferenceand Exhibition

worldfzo.org

Global Value Chain: Opportunities for the Free Zone of the Future