Government Short of Cash to Build Free Trade Zones

Hopes are being placed in two free economic zones in the north and south of Tajikistan, but the government is short of cash to put them into operation.

Government Short of Cash to Build Free Trade Zones

Hopes are being placed in two free economic zones in the north and south of Tajikistan, but the government is short of cash to put them into operation.

Saturday, 18 April, 2009
Yekaterina Slavina reports that there will be one free economic zone or FEZ in Soghd region and another close to the southern border with Afghanistan; two more are planned. Manufacturers who relocate there will be offered various tax concessions and will be able to repatriate capital.



Larisa Kislyakova, the deputy minister of economic development and trade, says the legal framework is already in place.



However, Nikro Zabirov, who heads the Union of Exporting Entrepreneurs, complains that the costs of setting up shop in the FEZ are too high. For instance, a license to operate there will cost 5,000 US dollars, firms must make a 500,000 dollar investment, and then they can export only 50 per cent of their products.



“I’d have thought that initially, those barriers should have been removed,” he said.



There is a more immediate problem – the Tajik government cannot afford the money needed to provide basic infrastructure for the FEZs.



“Unfortunately, we cannot currently allocate enough funds from the budget to create the primary infrastructure so that the FEZ can start operating,” said Kislyakova, “even though we very well understand that no economic zone can function without that.”



She added, “We are working with the banks and with the finance ministry; we intend to get a one-off grant or a one-year loan to get these zones operating.”

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