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Special Economic Zones (SEZs)

Definition

Special Economic Zones (SEZs) are designated geographical regions within a country that have special economic regulations and incentives aimed at attracting foreign investment, promoting exports, and boosting economic growth.

Analogy

Think of SEZs as exclusive shopping malls with special discounts for international shoppers. These malls have unique rules that encourage foreigners to shop there by offering tax breaks and other benefits.

Related terms

Free Trade Zones (FTZs): Free Trade Zones are specific geographic areas where goods can be imported, stored, processed, manufactured, or re-exported without being subject to customs duties.

Export Processing Zones (EPZs): Export Processing Zones are industrial parks or zones set up by governments specifically for exporting goods. They often offer tax incentives and streamlined procedures for businesses.

Maquiladoras: Maquiladoras are manufacturing plants located near the United States-Mexico border where raw materials are imported duty-free for assembly or processing before being re-exported.