INTRODUCTION The concept of Special economic zones is quite popular with developing countries as it gives an opportunity for the domestic players to compete on international level with other countries. It also plays a catalytic role by helping the countries to export new products and find new markets, and in building up the image of the countries' products in the international market. Special economic zones are the zones where “industrial zones with special incentives attract foreign investors in which imported materials undergo some degree of processing before being exported again. The logic behind these zones was the creation of an area in which domestic policies do not hold and in which, therefore, a government could implement policies designed to enable individual firms to invest profitably on the basis of a country’s comparative advantage.” (SAWKUT, VINESH, & SOORAJ, 2009) Earlier, Special economic zones were known as Export Processing Zones (EPZs) or free ports. Some authors used both the terms interchangeably while others like UNCTAD (1994) cited in (WEI, Dec 2000) explain that “the greatest difference between EPZs and SEZs is that, EPZs are usually located in countries with a market economy, whereas SEZs are typically found in an economy transition from planned economy to market economy”. \ What is market economy?? In 1950s and 1960s, the development of export processing zones, in the developing countries, was the outcome of a move for industrialization to increase the pace of economic growth by adopting various strategies. This drive was strongly motivated by import substitution. In order to reduce or eliminate the importation of foreign industrial goods, domestic production were encouraged by protecting the ma... ... middle of paper ... ...novation, Volume 7, Number 2 , 199-221. GE, W. (1999). Special Economic Zones and the Opening of the Chinese Economy: Some Lessons for Economic Liberalization. World Development Vol. 27, No. 7, , 1267-1285. Subrahmanian, K. K., & Pillai, P. M. (Aug. 26, 1978). Multinational Firms and Export Processing Zones. Economic and Political Weekly, Vol. 13, No. 34 , 1473-1477. WEI, X. (Dec 2000). ACQUISITION OF TECHNOLOGICALCAPABILITY THROUGH SPECIALECONOMIC ZONES (SEZS): THE CASE OF SHENZHEN SEZ. Industry and Innovation, Volume 7, Number 2 , 199-221. Wong, K.-Y., & Chu, D. K. (1984). Export Processing Zones and Special Economic Zones as Generators of Economic Development: The Asian Experience. Geografiska Annaler. Series B, Human Geography, Vol. 66, No. 1; Published by: Blackwell Publishing on behalf of the Swedish Society for Anthropology and Geography , 1-16.
Regional trade agreements have been prevalent since the early 1990s. A Regional trade agreement removes all barriers to trade and foreign investment, which means that poor economies are not allowed to use import tariffs to protect their growing industries or their farmers from floods of cheap imports. Free trade agreements also include additional rules on investment that pose a prospective threat to poor people’s access to public services. This clearly states that even though poor countries have the advantage of strength in numbers as compared to the rich economies and countries, the former are more likely to be pushed into accepting unreasonable demands of the richer economies. Therefore, it can be analyzed that a Regional Trade Agreement between equal partners can prove to be beneficial for both, but such an agreement between unequal partners ( rich and a poor economy) shall probably prove to be beneficial for the stronger economy.
Zeng, D. (2011). How Do Special Economic Zones and industrial Clusters Drive China's Rapid Development. Washington: World Bank: Policy Research Working Paper.
Few governments will argue that the exchange of goods and services across international borders is a bad thing. However, the degree to which an international trading system is open may come into contest with a state’s ability to protect its interests. Free trade is often portrayed in a good light, with focus placed on the material benefits. Theoretically, free trade enables a distribution of resources across state lines. A country’s workforce may become more productive as it specializes in products that it has a comparative advantage. Free trade minimizes the chance that a market will have a surplus of one product and not enough of another. Arguably, comparative specialization leads to efficiency and growth.
Free Trade Zones a name used in many other countries as the name, Foreign Trade Zones is mainly used by the United States, previously called free ports are areas set up within designated areas within countries borders, and Foreign Trade Zones help minimize barriers in international trade helping importers and exporters to operate under better economic conditions.
Silva, Julie A. and Robin M. Leichenko. Economic Geography. Vol. 80, No. 3 (Jul., 2004), pp. 261-
Profile of Exports, Imports and Trade Partners. Creative Commons Attribution-ShareAlike 3.0 Unported License, n.d. Web. 13 May 2014.
...stinguish that a qualitatively new type of worldwide trade was developing. The illustration in United stated since the late of 1980 showed that “has less productive portions moved offshore which lead to a decrease in employment while maintaining higher value-added parts. Consequently, all the productivity has risen, while the tradable sector has increased employment” (Spence and Hlatshwayo,2011).
The article examines some of the influential theories in the domain of international trade including hyperglobalisation and comparative advantage. The publisher was keen to demonstrate how the theories need to be embraced since hyperglobalisation promotes investments flows from partners pursuing such trading agreements. The trading partners can still reduce their operation cost such as transportation while still navigating the complexities of hyperglobalisation. The author also endeavored to demystify the terminology of comparative advantage by issuing examples and previous concerns reported on the subject. It has been hailed that the traders often traded as per their factor endowments by concentrating on spheres of their specialty. The author also hinted to the readers that the theory of comparative advantage is a major concept since it is the first theory that economics students are briefed on. Arguments in support of the theory reveals that countries that have this level of visibility stand to benefit massively once they specialize in areas of their specialty. He purp...
The 21st Century has witnessed Asia’s rapid ascent to economic prosperity. As economic gravity shifts from the Western world to the Asian region, the “tyranny of distance [between states, will be] … replaced by the prospects of proximity” in transnational economic, scientific, political, technological, and social develop relationships (Australian Government, 1). Japan and China are the region’s key business exchange partners. Therefore these countries are under obligation to steer the region through the Asian Century by committing to these relationships and as a result create business networks, boost economic performance, and consequently necessitate the adjustment of business processes and resources in order to accommodate each country’s
China's development is praised by the whole world. Its developments are not only in the economic aspect, but as well in its foreign affairs. Compared with other developed countries, China is a relatively young country. It began constructing itself in 1949. After 30 years of growth, company ownership had experienced unprecedented changes. Entirely, non-state-owned companies can now be more involved in sectors that used to be monopolized by state-owned companies.
Many other countries operate special customs areas, such as free trade zones (also referred to as FTZs) and export processing zones. U.S. exporters and other interested parties should contact the embassy or customs officials of individual countries for specific procedures, requirements, and arrangements. Although there may be several similarities, it should not be assumed that a free trade zone overseas operates under the same principles as a foreign trade zone in the United States. Contact information for foreign embassies is available by calling the Trade Information Center at 800- USA-TRADE, or by visiting www.export.gov/tic. Many U.S.freight forwarders also have working relationships with trade zones overseas and can provide information on the documentation required to ship goods through them.
different parts of the world. In India, there is a great diversity which exists in the socio- economic and regional backwardness.
Wilkins, M. (2005), "Multinational enterprise to 1930: discontinuities and continuities", chapter 2 in A.D. Chandler and B. Mazlich (eds. Leviathans: Multinational Corporations and the New Global History, New York: Cambridge University Press. Jones, G. G. (2005), "Multinationals from the 1930s to the 1980s", chapter 3 in A.D. Chandler and B. Mazlich (eds. Leviathans: Multinational Corporations and the New Global History, New York: Cambridge University Press. Chandler, A.D. (1986), "Technological and organizational underpinnings of modern industrial multinational enterprise: the dynamics of competitive advantage", chapter 2 in A. Teichova, M. Lévy-Leboyer and H. Nussbaum (eds. ), Multinational Enterprise in Historical Perspective, New York: Cambridge University Press.
Trade creation occurs when low cost producers within free trade area replace high cost domestic producers. These agreements create more opportunities for countries to trade with one another by removing the trade barriers and investment. Trade creation allows member countries for a wider selection of goods and services not previously available. They can acquire goods and services at a lower cost after trade barriers due to lowered tariffs or removal of tariffs which will encourage more trade between member countries the balance of money spend from cheaper goods and services, can be used to buy more products and services. Regional economic integration significantly contributes to the relatively high growth rates in the nation. By removing trade barriers between members countries the factor of production can be move
Stonehouse, G., Campbell, D., Hamill, J. & Purdie, T. (2004). Global and Transnational Business (2nd ed.). Chichester: John Wiley & Sons.