Free zones will need to be more integrated and collaborative in their approach and open their doors to global talent, investments and technologies, according to experts attending the World Free Zone Organization’s second annual international conference and exhibition in Dubai.

Free zones have functioned in the past as isolated economic clusters with little to no interaction with the local economy, they felt.

The concluding session of the conference highlighted the impact of Global Value Chains (GVC) on the free zones of the future, as well as the opportunities they presented for economic development.

Moderated by Gary Gereffi, professor of sociology and founding director of the Center of Globalization, Governance and Competitiveness, Duke University, the session drew the participation of four panelists – Gokhan Akinci, global product leader at World Bank Group; Hernando José Gómez, former Colombian Ambassador to WTO (Colombia); Martin Ibarra, vice chairman, World FZO (Colombia); and Przemyslaw Kowalski, senior trade economist, Organization for Economic Co-operation and Development (OECD), France.

Gereffi said: “There has been a tendency for developed countries to concentrate on higher value activities while developing countries are generally focused on the lower value activities. An ideal free zone of the future is one that will bundle together companies that bring value to each other and to the economy. We need best-in-class expertise to achieve a triple bottom line of social, environmental and economic upgrading. With the right training and collaboration, this can become a reality.”

Gómez said: “Global value chains are very demanding in terms of regulations – such as taxation procedure or pre-requisites to operate in - and in terms of infrastructure requirements. Free zones can address these issues through promotion of research and development (R&D). They can also incentivise and attract human capital, including academic experts and dedicate resources for skill development and superior ICT technologies. Policy-makers must use tools to measure advancement and growth within free zones, so that any gaps in the operations or demand may be identified and addressed proactively.”

Kowalski said: “Collecting and analysing comparative data is a critical strategy to help free zone operators and business leadership working within them to plan for the future. It is also essential to have access to foreign inputs and cross-country knowledge, which are major contributors of competitiveness on the global level. To succeed, one must have access to data that can help these free zones nurture the best people, resources and ideas. We need to open the communication pathway between free zones and the local industries. Considering the rate at which technology is advancing, we can no longer afford to work in silos, but must instead embrace collaboration.”

The World Free Zone Organization Conference and Exhibition concluded yesterday (May 11) at the Grand Hyatt Dubai. The 2016 edition attracted the participation of international free zones, multi-lateral and commercial organizations and encouraged open dialogue towards developing a vision for the free zone of the future.

The three-day conference and exhibition included five panel discussions and six workshops. The discussions examined the key challenges facing free zones today and the most significant opportunities they have ahead of them towards shaping a dynamic environment that supports the growth of this pivotal economic sector.  – TradeArabia News Service