GOVERNMENT has given an international commitment for the establishment of a legislative framework for special economic zones by September this year, reported Trade Ministry Acting Permanent Secretary Frances Seignoret.
She was speaking yesterday as the Public Accounts (Enterprises) Committee met with officials of the TT Free Zones Company and the Trade Ministry at the Parliament building.
Seignoret said, in 2011, World Bank did a review of TT’s free zones and one of the recommendations spoke to the importance of a special economic zones regime.
She said the Trade Ministry developed the special economic zones policy which was approved by Cabinet in 2017 and was available on the ministry’s website.
Seignoret said there was still an ongoing process and it was hoped by September this year there would be even greater progress.
She said for implementation there needed to be a new special economic zones act and other activities.
“We are quite excited that that will in fact enhance the offerings that TT can deliver to foreign and local investors.”
She said the ministry was about 95 per cent ready and would be moving shortly to seek the mandate of the Cabinet in moving forward with the legislative framework.
PAEC member Amrita Deonarine asked if the new special economic zones would focus on enterprises that diversify away from the energy sector.
Trade Ministry director of policy Randall Karim said that would be one of the core areas with the realignment from the old free zone regime to the special economic zones regime.
He said, with the review of the performance of the free zone regime, one of the observations made by the World Bank was that it was not focused in promoting those levels of economic activities in specialised areas in alignment with the country’s strategic development plans.
Karim said the special economic zones policy looked to promote and incentivise areas of economic activity linked to the growth and development of the non-energy sector.
He said other deficiencies found by the World Bank were that the existing reporting requirements were very weak and, once a company was approved, the incentives were granted in perpetuity without the ability to roll back.
“A company getting an incentive in perpetuity is perhaps not in the best interest of any country.”
He said the World Bank highlighted the need for incentives to be focused, “time-bombed” and linked to economic targets.