Benefits of Special Condition Free Zones for the Production and Export of Commodities

[original article in ICANA]

The Chairman of the House Committee on Industry and Mines was critical on the use of free zones through the imports of consumer goods: “free zones must have an effect on economic development and trade. However, that does not mean from business and imports, but rather exporting domestic goods at a low price.” A Parliament Representative from Buin Zahra (a county in Qazvin Province) also expressed the same sentiment.

Ruhollah Abbaspoor, during an interview with a reporter from a state ran economic news agency, commented on the philosophy of establishing a free zone in the country: “the purpose of establishing a free zone is to protect domestic production [of goods] as well as lower costs within the business market in order to attract domestic and foreign investors.”

Free zones must benefit from tax cuts and be utilized in production and the export of goods. He specifically talked about free zones through imports: “this is due to the government’s economic policies, their aim to control inflation, and to proceed with the import of commodities. With this objective, the free zone has been altered for the channels of importing [only].”

The Chairman went on to say that one of the important ways to strengthen the economy is to [decrease] the level of imports. In the same breath, free zones must benefit from lower prices and tax breaks in the production and export of goods. However, this has been ignored in recent years.

According to a Representative of the Ninth Parliament, “it is in our country’s best interest to not buy imported goods, especially consumer goods; and in the words of our Supreme Leader, we should encourage our people to buy goods made in Iran.” When the representative from Buin Zahra was asked a similar question on whether there is a need to create a free zone in the country he stated that, instead of establishing new free trade zones the existing zones should be reinforced.

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