Differentiating The Value Proposition
At a Glance
- Because it is possible for the various incentives offered to companies to locate in an SEZ to end up costing more than the development generates in positive returns for the country, it is crucial for those involved to build a strong business case for the SEZ.
- SEZs should have a clear value proposition for a target group of investors, and this should differentiate the SEZ from other investment locations within and outside the country.
- Differentiating factors could include the location, physical characteristics of the SEZ, nature or quality of services offered, economic linkages, and access to markets and/or inputs, all of which can be strengthened through targeted incentives.
- SEZs are a policy tool to promote economic development and therefore the final offering of the SEZ should be tailored to the original goal(s) of the SEZ programme.
Getting an SEZ off the ground is a significant undertaking. It requires active participation and support of private and public sector and involves substantial investments. It is possible for the various incentives offered to companies to locate in an SEZ – including tax breaks, inexpensive land, deep discounts on water and electricity, and other subsidies – to end up costing more than the development generates in positive returns for the country. That is why it is crucial for those involved to build a strong business case for the SEZ.
- Economic Security and Competitiveness: Using Special Economic Zones to Drive Job Creation in MENA (Kurt Dassel, Kim Eckermann)
- Poland: A True Special Economic Zone (Ernst and Young Global Limited)
- Special Economic Zones in Afghanistan A New Business and Economic Deal for 2020? (Samuel Hall)
- The Implications of Successful SEZs in Northeast Asia: Opportunities for Developing SEZs in Mongolia (Tsolmon Tsagaach)
This document provides users with a case study of Special Economic Zones value propositions in a highly constrained environment. It ...