Ask any expert on economic zones, and they'll always have a caveat: It's difficult if not nearly impossible to compare zones across world regions due to a paucity of data or a lack of apples-to-apples metrics by which to measure their performance.
To try to solve these issues, one recent academic effort even goes so far as to compare intensities of light from satellite photos of zones as a proxy for activity — which itself has the huge caveat of assigning credit to zones where energy is being burned the most intensely. That doesn't necessarily translate to a zone producing the most value or performing at a peak level for occupiers.
This year Site Selection is able to bring a new perspective to this conundrum, in multiple forms.
First, we asked our chief audience, surveying the global corporate investor and site consultant community and asking them to name their picks for Top Free Trade Zones in the world, arranged by region. Find the winners and compelling facts about their regions compiled by Conway researchers McKenzie Wright and Spencer Bauer on the pages that follow.
Next, we worked with valuable data from our friends at Investment Consulting Associates, who from December 2010 through January 2018 tracked 2,722 investment projects in more than 280 non-U.S. free zones. With the valuable guidance of our director of programming and analytics Daniel Boyer, we created two indices: one that ranks the top 20 zones by straight tallies of projects and their related capital investment and job creation numbers; and a second that ranks the top 20 on a per-capita basis using country-level population figures. Find those lists on the following pages as well.
Last but not least, we have evaluated U.S. Foreign-Trade Zones based on the most recent annual figures from the U.S. FTZ Board listing numbers of resident production and warehouse operations in each of the zones. We tallied those numbers in five different indices, then cross-indexed to come up with our top 20.
A common thread? Most of the best economic zones in the world have a port or airport close at hand, and a team of helping hands even closer.
— Adam Bruns
Site Selection's Top Free Trade Zone Winners
Methodology: Survey of global corporate investors and site consultants
Tanger Med Zones, Morocco
- Tanger Free Zone, created in 1999, is an industrial and logistics hub in Morocco that supports a multitude of industrial activities such as Automotive, Food, Electronics, IT Engineering and Aviation.
- Tanger Free Zone's Tanger Med port gives it a distinct geographical competitive edge, allowing it to serve Europe in under three days, America in 10 and Asia in 20. Its investment incentives provide competitive tax, administrative and customs benefits. The region has 22 training centers that have adapted to the needs of growing sectors filled with a young and dynamic population.
Lekki Free Zone, Nigeria
- In 2020, the Lekki Deep Seaport, a US$1.5-billion venture, will be completed, with depths up to 16 meters (52.5 ft.) to allow more cargo capacity and support commercial operations.
- Nigeria is the seventh most populous country in the world with 19 investment rich sectors including Petroleum, Agriculture, Telecommunications, Manufacturing, Construction and Mineral Resources.
- Nigeria is the world's 12th largest producer of petroleum. It contains a vast category of resources ranging from natural gas, tin, iron ore, coal, limestone, lead, zinc, and arable land.
Incheon Free Economic Zone, South Korea
- South Korea's IFEZ includes Incheon International Airport, the world's No. 1 airport service for eight years and home to the world's second largest air network.
- Businesses have ongoing support from the Korean government through tax benefits, financial support, land supply subsidy, intellectual property protection, and deregulation of foreign invested companies.
- Korea has a highly skilled workforce matriculating through its world-renowned universities and growing major metro areas.
Daegu–Gyeongbuk Free Economic Zone, South Korea
- The DGFEZ has excellent R&D support and infrastructure consisting of 35 government research institutes, 11 government-designed R&D centers and five industry support centers.
- The DGFEZ offers financial incentives for foreign-invested companies such as a 100-percent exemption of corporate income tax from three to five years based on requirements.
- The DGFEZ automobile sector is the largest in Korea, producing just shy of 2 million units a year. This sector includes automakers such as Hyundai, Renault and GM Korea.
Canada & US
U.S. Foreign-Trade Zone No. 26, Atlanta, Georgia
- The FTZ has three international ports of entry — Atlanta, Savannah, and Brunswick that provide immediate access to FTZ benefits, i.e. space where merchandise can be stored indefinitely, assembled, test, repackaged and relabeled.
- The Port of Savannah handled 4 million TEUs over the past year, a new record.
- Hartsfield Jackson Atlanta International Airport served 100 million passengers and is confirmed as the busiest airport in the world for 20 consecutive years, even as it also expands its cargo offerings.
U.S. Foreign-Trade Zone No. 122, Corpus Christi, Texas
- The Port of Corpus Christi has a 47-feet-deep channel and great location that provides quick access to the Gulf of Mexico and inland U.S. via routes such as Highway 37 and 181.
- Corpus Christi has multipurpose infrastructure that supports operation year-round, making the location ideal for productivity and improved cost-effectiveness.
- Major activities at Corpus Christi include production, assembly, repackaging, repair, storage and testing.
Klaipeda Free Economic Zone, Lithuania
- The Klaipeda FEZ was the first FEZ to be located within the Baltic region and is still the largest tax-free area within Lithuania.
- The Klaipeda FEZ is closely located to Europe's northern-most ice-free port, giving this FEZ access to the whole EU and much of Eurasia.
- The Klaipeda region is a hub of young, educated and skilled workers thanks to six higher-learning institutions located in the area. Almost half of the people in the Klaipeda region are under the age of 40.
Shannon Free Zone, Ireland
- Shannon was the first Free Trade Zone ever to be created in the world, which grew out of the world's first duty-free shop. Established in 1950 at Shannon Airport, it was the brainchild of Dr. Brendan O'Regan, founding chairman of the Shannon Free Airport Development Company, now known as Shannon Development, the Republic of Ireland's first regional development agency.
- Among recent investments in the zone was a January 2018 commitment by Jaguar Land Rover to employ 150 at two new software engineering centers.
- The airport located in Shannon has the longest runway in Ireland, measuring in at 3,200 meters (10,500 ft.).
Latin American & Caribbean
Coyol Free Zone and Business Park, Costa Rica
- In Costa Rica, medical devices have become the country's most important export, and more than half of those exports come from the Coyol Free Zone.
- Eight of the top 30 medical device companies have a location in the Coyol Free Zone.
- As a percentage of the country's GDP, Costa Rica has by far the highest percentage of exports of telecommunications, computer and information services in all of Central and South America at 7.3 percent.
Panama Pacifico Special Economic Zone, Panama
- The Panama Pacifico Special Economic Area was created thanks to Panama's Law 41 of 2004, which provides incentives to companies for locating their regional headquarters in Panama.
- The Panama Pacifico International Airport is located on site. In 2017 passenger traffic grew by 94 percent to 255,737 thanks to the market entry of the airline Wingo.
- Panama Pacifico offers a one-stop-shop service, whereby 17 government agencies are all centrally located in the same space to hasten the administrative processes for businesses.
Dubai Multi Commodities Centre (DMCC), United Arab Emirates
- Some 170 new companies set up shop in DMCC every month. "The cost of real estate is just one driver of business decisions," DMCC Free Zone Director Krysta Fox told Site Selection in 2016. "The DMCC has 66 towers, covering all levels of property offer. This has created an environment of choice, and the forces of supply and demand are able to operate freely. The fact that companies can own or lease has really helped with long-term thinking."
- DMCC is just seven hours of flying time away from 5 billion people, and four hours from 2 billion people.
- DMCC is home to the largest port between Rotterdam and Singapore, the Jebel Ali Port.
Dubai Airport Free Zone, United Arab Emirates
- Over 200 multinational companies and almost 100 Fortune 500 companies have located themselves in the Dubai Airport Free Zone.
- While not directly located in the Dubai International Airport, the Dubai Airport Free Zone is in very close proximity to the airport, which has connections to over 220 locations across six continents.
- Dubai Airport Free Zone is the first entity to develop a business-to-business smart commerce platform — called Dubai Blink — that will use AI and blockchain technology so companies around the world can safely connect and trade via Dubai.
Methodology: Indexed project data from Investment Consulting Associates for 2,722 corporate end-user investment projects in 280 zones worldwide from December 2010 through January 2018
Methodology: Project data from Investment Consulting Associates for 2,722 corporate end-user investment projects in 280 zones worldwide from December 2010 through January 2018, indexed by latest national population figures
Methodology: Indexed by top 25 zones in a) value of warehouse merchandise received and b) value of warehouse exports; top 25 zones in number of warehouse firms; top 25 zone-based production operations and top 25 in value of production exports; 78th Annual Report of the U.S. Foreign-Trade Zones Board to Congress, November 2017