On 16th October, RUSI published a Commentary saying that while foreign trade zones bring many benefits, they require greater transparency in order to operate securely and ethically. It says that foreign trade zones anywhere are defined by 3 key characteristics –
- they are geographically delineated areas considered to be outside of the normal customs area;
- they have a management authority that can be public, private or mixed; and
- their authorities offer special benefits in exchange for locating within the zone.
It says that FTZ form the backbone of global supply chains and are the lubricant to the cogwheels of globalisation – yet their importance is frequently overlooked or misunderstood in everything from international development goals to efforts at combating terrorism, transnational organised crime and trade fraud. It warns that the absence of a standardised set of regulations for zones means that in many places they are the ‘Wild West’ of globalisation, cowboy capitalism at its worst.
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