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A Free Trade Zone (FTZ) is a geographic area where goods may be landed, handled, manufactured or reconfigured and re-exported without the intervention of Customs Authorities. Only when the goods are moved into consumer status within the country in which the zone is located, do they become subject to the prevailing custom duties.

Free Trade Zones are organised around major seaports and major international airports. Free Trade Zones can be defined as labour intensive manufacturing centres that involve the import of raw materials or components and the export of factory products.

Free Trade Zones are sometimes referred to as Special Economic Zones (SEZ) and are an area in which the business and trade laws are different from the rest of the country. SEZs are used by many economies to promote trade, economic growth and industrialisation.


SEZs have been implemented both in emerging market economies including Brazil, China, India, Russia, Mauritius, Nicaragua, Honduras, Timor-Leste and South Africa and in advanced economies such as Canada, France, Singapore, the United Kingdom, the United Arab Emirates and the United States. Fiji has experimented with SEZs and Australia has long-considered some form of a SEZ in the northern part of Australia to stimulate economic growth and redistribute Australia’s southern-based population.

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