What is Special Economic Zone?
SEZ is generally characterized as a geographical area within a region of a country where certain economic activities are encouraged by a conventional of policy instruments that are not generally applicable to the rest of the countries. Special economic zones are intended to facilitate fast economic growth. it is done by giving special leverages in taxes so to attract foreign investments and technologies.
China is the best example of Special Economic Zone. SEZ essentially worked as a liberal economic environment that encourage modernization and development within china borders. SEZ is a broad term as it can be classified into four categories namely:
- Export Processing Zones which help in facilitating manufacture of goods for export. These are small in size hence offer support to infrastructure and services.
- Free Trade zones facilitate international trade in both – goods as well as services.
- Free ports zones are large in scale and cover both domestic as well as international activities.
- Enterprise Zones covers a huge range of economic activities within remote areas or local areas which are very deprived off.
Features of Special Economic Zones are: –
- Demarking of geographical area with physical security.
- Prompt administration by single Authority.
- Enhancement of financial and procedural benefits.
- Efficient and reorganized procedures
- Separation in custom area.
- Liberal economic laws for governance.
What is the Role of Special Economic Zone in a Countries Development?As everybody knows that every organization has an aim to achieve so Special economic zone has also certain objectives to achieve. International business assignment help by right providers also helps to understand more about the topic. Its objective makes it very effective in the development of a country hence, their roles in the development of a country are as follows: –
- Enhancement of foreign investment specially to attract the attention of foreign direct investment so to attain or increase GDP.
- Second main aim is to increase share in global markets so to increase credibility in market.
- It works like experimental laboratories where new policies and approaches applied for earning high benefits and output results.
- To yield additional economic activities which in turn support reform strategies and minimize anti-export bias while keeping defending blocks intact.
- Creation of new employment opportunities and so works like a pressure valve to lessen large scale unemployment.
- It enhances the development of a country by developing and diversifying its export strategies.
- Helpful in the development of infrastructure facilities.
- Helpful in giving exposure to technology and techniques of global markets.
- It helps in generating employment opportunities with in a territory.
- Gives a boost to export growth.
- Give an increase to government revenue.
- Increase in foreign exchange earnings.
- Skill upgradation of people of a region.
- Promote technology transformation from highly advanced area to needy areas.
- Enhancement in the productive abilities of local firms. Etc.