x You are a business, a private, organization, ... want to understand the model, how to operate, the characteristics of Free Trade Zone?
X many import -export enterprises, investors need to learn about the benefits and challenges when participating in Free Trade Zone (FTZ)?
X and you wonder if Bonded Warehouse and KTMTD Free Trade Zone are the same? Is the same model?
What is free trade zone and the knowledge you need to know about Free Trade Zone will be Proship.vn in a complete and detailed way in this article. Through this, import -export enterprises, investors on FDI capital, organizations, ... also grasped the situation to have the right and reasonable development orientation in KTMTD Free Trade Zone.
Free trade zone: Concept, characteristics and popular ftzs
Free trade zone is, what characteristics are there outstanding? The following content will help you understand the Free Trade Zone (FTZS) development model:
What is free trade zone?
Free Trade Zone (FTZ) is a free commercial area (KTMTD), also known as free zone (free zone) is an area determined by the state, foreign goods can be processed, processed, separated, packaged, processed without import tax.
KTMTDs are often formed around major seaports, international airports or near the national border, areas with many geographical advantages for trade.
Free trade zone
Free trade zone (FTZ) types include:
- Free Ports - Free port: Allow imported goods without tax (if not consumed in the inland);
- Export Processing Zones (EPZS) - Export processing zone: Focus on commodity production for export;
- Special Economic Zones (SEZS) - Special Economic Zone: Having tax policies, investment and preferential trade to attract businesses;
- Bonded WareHouses - Bonded warehouse: The place where the goods can be stored without paying import tax until sold into the domestic market.
Characteristics of Free Trade Zone
Characteristics of KTMTD Free Trade Zone:
- Freedom of circulation: Goods, services, capital and labor moving freely across the border;
- Dismantling trade barriers: Tariffs, limiting quantity, limiting non -tariffs are eliminated or minimized among member states;
- Common trade policy: Member States apply common trade policies to countries outside the region;
- Economic cooperation: Members' countries cooperate in areas such as investment, infrastructure development, science and technology, ...
What does Vietnam benefit when participating in Free Trade Zone Free Trade Zone?
What is the benefit of Vietnam when participating in Free Trade Zone? With the incentives that the free trade area (KTMTD) brings, Vietnam has received the following benefits:
FTZ helps stimulate trade and investment
Enterprises can access larger markets with lower costs, attracting foreign direct investment (FDI).
FTZ helps to improve people's lives
Free Trade Zone helps consumers to access diverse goods with more competitive prices, improving life.
FTZ enhances competition
With Free Trade Zone, businesses are forced to improve competitiveness to meet the market demand.
FTZ helps to cooperate and integrate internationally
Free Trade Zone contributes to strengthening cooperation and international economic integration, promoting peace and stability in the region.
FTZ helps to promote economic growth
Free Trade Zone contributes to creating favorable business environment, promoting economic growth and creating jobs.
Challenges when participating in KTMTD Free Trade Zone
Besides benefits, challenges when participating in free trade zone? That is:
Challenges of labor transfer
KTMTD Free Trade Zone moves labor from countries with high labor costs to countries with low labor costs.
Challenges of cultural and institutional differences
Member States may have a difference in culture, institutions and legal systems, making it difficult to cooperate and coordinate.
Challenges of consumer protection
It is necessary to ensure food safety, protect consumers' interests and anti -counterfeit and counterfeit goods.
Challenges of environmental impacts
Increasing trade and production will lead to excessive environmental pollution and exploitation of natural resources.
Therefore, to receive incentives from Free Trade Zone, Vietnam needs a suitable strategy to make the most of the opportunity and limit risks from free trade zone.
Compare bonded bonded bonded warehouse and free trade zone? How to apply FTZ?
Let's find out the content below to know the difference between bonded warehouse bonded warehouse and free trade zone as well as how to apply the operating model of the FTZS free trade area in practice:
The difference between bonded warehouse and free trade zone
What is the difference between bonded bonded bonded warehouse The free trade area like the bonded warehouse is that the goods in and out are under the control of the customs force.
The most basic difference is that the free trade area is usually a fairly large area, including many businesses operating with different functions. Meanwhile, bonded warehouse has a limited area and is only owned by a business.
* Example: Colon Free Trade Area in Panama is a typical example. In this area, more than 1,000 enterprises operating, including factories, warehouses to banks, consulting companies, retail stores, repair services, ...
Goods subject to import taxes can be stored, manufactured or undergone production activities without having to pay taxes for up to 5 years (from the date of import).
How to apply free trade zone to reality
Steps to apply free trade zone in practice:
- Determine the appropriate FTZ: Select the FTZ area based on the type of goods, target markets and tax incentives;
- Complete registration procedures: Meet the requirements of business licenses and customs procedures to operate in FTZ;
- Managing inventory and production processes: Taking advantage of FTZ to optimize the storage and processing of goods before exporting or importing inland;
- Taking advantage of preferential policies: Enterprises should take advantage of tax exemption, VAT refund and support policies of FTZ;
- Monitor and comply with the regulations: Ensuring compliance with import and export requirements, environment and labor in FTZ.
Proship Logistics we answered what Free Trade Zone's and the practical benefits that FTZS Free Commercial Area brings, how to apply the KTMTD model into reality, ... If you see the knowledge sharing about this free free trade zone, please share with Proship and contact 0909 344 247 for advice on safety and freely transport solutions best.
