{"id":7394,"date":"2025-03-07T10:50:37","date_gmt":"2025-03-07T13:50:37","guid":{"rendered":"https:\/\/www.abrazpe.org.br\/?p=7394"},"modified":"2025-03-07T10:50:42","modified_gmt":"2025-03-07T13:50:42","slug":"can-special-economic-zones-spur-regional-attractiveness","status":"publish","type":"post","link":"https:\/\/www.abrazpe.org.br\/index.php\/2025\/03\/07\/can-special-economic-zones-spur-regional-attractiveness\/","title":{"rendered":"Can Special Economic Zones spur regional attractiveness?\u00a0"},"content":{"rendered":"<p class=\"estimated-read-time\">Tempo de leitura:<small> 5 minutos<\/small><\/p> \n<p>A place-based policy that has long been part of the regional development toolbox can be traced to Ireland\u2019s west coast \u2013 the home of the Shannon Free Zone. Launched in 1959, it is widely considered the first Special Economic Zone (SEZ). The Shannon project began as a response to developments in long-range aircraft technology as planes no longer needed to refuel in Shannon before continuing to major centres like London or Paris. A local entrepreneur advocated that the central government apply incentives to help lure investors and manufacturers. This included tax incentives, a waiver on import duties, and freeing up land for development.<\/p>\n\n\n\n<p>The SEZ is just one example of the way advances in technology and globalisation have resulted in place-based responses aimed at improving economic attractiveness to investors and providing opportunities for local SMEs to integrate into global value chains.&nbsp;&nbsp;<\/p>\n\n\n\n<p>Indeed, the \u201cShannon Model\u201d eventually inspired a Chinese delegation to make several visits in the 1980s. This included by then-Minister and later President Jiang Zemin, who eventually adopted SEZs as a pillar of China\u2019s regional and industrial development strategy. The SEZ model is widely attributed with the rapid industrialisation of city-regions like Shenzhen and is credited with&nbsp;<a href=\"https:\/\/www.worldbank.org\/content\/dam\/Worldbank\/Event\/Africa\/Investing%20in%20Africa%20Forum\/2015\/investing-in-africa-forum-chinas-special-economic-zone.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">attracting nearly half of the foreign investment in China and nearly \u00bc of the country\u2019s GDP<\/a>.&nbsp;&nbsp;<\/p>\n\n\n\n<p><strong>Expanding borders and deepening connections with local economies&nbsp;<\/strong><\/p>\n\n\n\n<p>Many of today\u2019s zone policies maintain fiscal incentives, yet the toolbox for attracting and retaining foreign direct investment (FDI) is now more versatile. Today<a href=\"https:\/\/www.oecd.org\/en\/publications\/rethinking-regional-attractiveness-in-the-new-global-environment_a9448db4-en.html\" target=\"_blank\" rel=\"noreferrer noopener\">, international investors demand a broad range of assets, including key transport infrastructure, digital connectivity and, above all, talent<\/a>.&nbsp;&nbsp;<\/p>\n\n\n\n<p><strong>Growth in greenfield FDI capital expenditure towards OECD regions<\/strong>&nbsp; (% change in capital expenditure, Jan. 2016 \u2013 Dec. 2019 vs Jan. 2020 \u2013 Dec. 2023)&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/i0.wp.com\/oecdcogito.blog\/wp-content\/uploads\/2025\/02\/SEZ-blog-map.png?resize=840%2C518&amp;ssl=1\" alt=\"\" class=\"wp-image-8020\"\/><\/figure>\n\n\n\n<p>Note: Not all datapoints can be classified by TL2 regions due to data limitations. OECD member regions without a bubble had no recorded inward FDI announcements either in the Jan. 2016 \u2013 Dec. 2019 period or Jan. 2020 \u2013 Dec. 2023 period.&nbsp; Source: FT FDI Market database&nbsp;<\/p>\n\n\n\n<p>Understanding this, many regions are connecting zone development plans with investments in key infrastructure, as well as building public-private and higher education partnerships which help to attract, train and retain the workforce demanded by prospective firms. A handful of SEZ policies have also become more versatile with their geographic scope, like&nbsp;<a href=\"https:\/\/lpr.gov.lv\/en\/latgale-special-economic-zone\/\" target=\"_blank\" rel=\"noreferrer noopener\">Latvia\u2019s Latgale SEZ<\/a>, extending the geographical boundaries of zones to apply to an area within the region&nbsp;that private investors deem most suitable for their investment.&nbsp;&nbsp;<\/p>\n\n\n\n<p>In Italy, recent reforms to SEZ legislation aim to revitalize development opportunities in the South (\u2018Mezzogiorno\u2019) under one&nbsp;<a href=\"https:\/\/www.strutturazes.gov.it\/media\/itmfetrr\/piano-strategico-zes-integrale.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">SEZ \u201cUnica\u201d policy<\/a>. This reform replaces the previous 8 geographically delimited SEZs with a single SEZ for the entire territory of southern Italy. While this approach removes SEZ boundaries, potentially addressing concerns about favouring incumbents and generating negative externalities, it may raise new challenges. In particular, the effective implementation of the SEZ Unica depends on strong multi-level governance (MLG) and the active involvement of regional and local actors.&nbsp;&nbsp;<\/p>\n\n\n\n<p>The Strategic Plan limits the single authorisation\u2014designed to simplify administrative procedures\u2014to investments in pre-defined strategic supply chains and technologies, with a minimum investment threshold. This represents an important lever for attracting investments in competitive sectors and will require coordination to ensure it does not only favour the traditionally leading regions.&nbsp;&nbsp;<\/p>\n\n\n\n<p>While regions can propose additional supply chains and administrative simplifications, the extent to which lagging areas will benefit remains unclear. Similar approaches to extending SEZ boundaries have been put in place in Poland and Latvia, but their effectiveness depends on tailored MLG mechanisms and a place-sensitive approach.&nbsp;&nbsp;<\/p>\n\n\n\n<p><strong>Which levers to pull?&nbsp;<\/strong><\/p>\n\n\n\n<p>Poland\u2019s regions have been at the forefront of using SEZs to drive broader development goals. In the \u0141\u00f3dzkie region, the&nbsp;<a href=\"https:\/\/sse.lodz.pl\/en\/\" target=\"_blank\" rel=\"noreferrer noopener\">\u0141\u00f3d\u017a SEZ<\/a>&nbsp;highlights how similar zones can help retain talent and strengthen local businesses. Beyond tax incentives, it focuses on skills development and entrepreneurship. Its Vocational School of Automation and Robotics, developed with the Technical University of \u0141\u00f3d\u017a and local investors, helps align education with industry needs, preparing students for jobs in the region.&nbsp;&nbsp;<\/p>\n\n\n\n<p>SMEs also benefit, with a start-up accelerator supporting 65 domestic companies in 2023. Between 2016 and 2022, the SEZ attracted 262 new investments, creating nearly 12,000 jobs. It also contributes to the region\u2019s Just Transition Plan, supporting workers affected by the shift away from coal. Through the&nbsp;<em>Transformation Area<\/em>&nbsp;initiative, the SEZ provides training, career guidance, and funding to help energy sector workers and local businesses adapt to the transition.&nbsp;<\/p>\n\n\n\n<p><strong>Rethinking the approach to attracting regional investment&nbsp;<\/strong><\/p>\n\n\n\n<p>Effectively assessing the impact of SEZs requires a multidimensional approach that goes beyond traditional economic metrics. It is crucial to assess the broader impacts, such as social, environmental, and innovation-related outcomes at the regional scale beyond the administrative boundaries of SEZ, to fully capture the multifaceted effects of this attractiveness policy tool. In this context,&nbsp;<a href=\"https:\/\/www.oecd.org\/en\/about\/programmes\/rethinking-regional-attractiveness.html\" target=\"_blank\" rel=\"noreferrer noopener\">the OECD\u2019s Regional Attractiveness methodology<\/a>, which is based on more than 60 indicators across various dimensions, is a starting place for examining a full range of effects of SEZ development in a region.&nbsp;&nbsp;<\/p>\n\n\n\n<p>Critically, this methodology enables monitoring at a regional (TL2\/NUTS-2) and local (TL3\/NUTS-3) level and takes a multi-dimensional approach including several indicators which could support SEZ design and evaluation.These include economic, innovation, social, environmental, and long-term impact indicators giving local authorities deeper and more well-rounded insights on which to base their policy decisions.&nbsp;<\/p>\n\n\n\n<p>New\u00a0forms of SEZs are taking shape across the OECD and represent a policy instrument which can help support the broad\u00a0<a href=\"https:\/\/commission.europa.eu\/topics\/eu-competitiveness_en\" target=\"_blank\" rel=\"noreferrer noopener\">competitiveness agenda<\/a>, enhancing regional attractiveness, creating opportunities for SMEs in terms of\u00a0 knowledge spillovers and supply chain integration, and improving FDI attraction in lagging areas. Critically, this should be backed by a strong regional governance system which ensures the zone\u2019s objectives are linked to the broader goals of a region, its people, and the SMEs who do business there, as well as places beyond\u00a0the host region.\u00a0<\/p>\n\n\n\n<p class=\"has-small-font-size\"><strong>Fonte\/Foto: Cogito<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p><small> 5 minutos<\/small> A place-based policy that has long been part of the regional development toolbox can be traced to Ireland\u2019s west coast \u2013 the home of the Shannon Free Zone. Launched in 1959, it is widely considered the first Special Economic Zone (SEZ). The Shannon project began as a response to developments in long-range aircraft technology as planes no longer needed to refuel in Shannon before continuing to major centres like London or Paris. A local entrepreneur advocated that the central government apply incentives <a href=\"https:\/\/www.abrazpe.org.br\/index.php\/2025\/03\/07\/can-special-economic-zones-spur-regional-attractiveness\/\" class=\"more-link\"><span>Continue lendo<\/span>\u2192<\/a><\/p>\n","protected":false},"author":6,"featured_media":7395,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,80,74],"class_list":["entry","author-fpx","post-7394","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artigos","tag-abrazpe","tag-comercio-exterior","tag-zpe"],"_links":{"self":[{"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/posts\/7394","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/comments?post=7394"}],"version-history":[{"count":1,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/posts\/7394\/revisions"}],"predecessor-version":[{"id":7396,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/posts\/7394\/revisions\/7396"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/media\/7395"}],"wp:attachment":[{"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/media?parent=7394"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/categories?post=7394"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.abrazpe.org.br\/index.php\/wp-json\/wp\/v2\/tags?post=7394"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}