Free Zones: Contributing to Global Recovery
How have free zones grown globally and how much impact have they generated?
Since the development of the first free zone more than 60 years ago, the world has seen this model grow significantly in terms of number and size. Today, there are more than 7,000 free zones in more than 145 economies, employing more than 100 million. According to the OECD, free zones are responsible for exports worth more than $3,500 billion a year representing 20 per cent of the global trade of goods. This simply shows the importance of this sector and its contribution to the growth of the global economy.
At IFZA, we see our role as a free zone community that connects business – particularly MSMEs – from Dubai to the world, and from the world to Dubai.
The pandemic has had a major impact on economies worldwide. How can Free Zones contribute to global economic recovery?
One of the key benefits that free zones provide host economies is that they contribute to the overall resilience in times of disruption, and play an important role in building sustainable supply chains. Free zones provide companies not only quicker and more cost-effective registration processes, but they also provide fiscal and regulatory advantages as well as turnkey solutions and support that allow them to start their operations – and contribute to the economy — faster than on the mainland. This plays an important role in building strength and resilience in times of disruption.
Our experience at IFZA also points out an important benefit of free zones in providing access to safe harbours for entrepreneurs in times of social and political disruption.
In the midst of the global challenges over the past 2 years, we saw a record inflow of entrepreneurs from many markets across Asia and Europe who have setup their business in Dubai’s safe, secure, and business-friendly environment that provides them with unequaled benefits in business and beyond.
In the same vein, the current situation in Europe drove a tenfold increase in both Russian and Ukrainian entrepreneurs to set up a business at IFZA. They are attracted by the ease of IFZA’s free zone business setup, and the prospect of better opportunities in a welcoming community.