Zoe Harris

How can Special Economic Zones Advance the Blue Economy?

The Monaco Ocean Week is offering to the financial world non only a panel of experts but also an awareness on possible action in the least covered sector of the UN SDGs (#14 : conserve and sustainably use the oceans, seas and marine resources for sustainable development) attracting only 3.5% of the sustainable investments – while this area certainly represents the highest financial opportunities for investors.

To speak about this blue economy, Zoë Harries, World FZO’s Project Director has been invited to speak at the “Blue and Sustainable Finance” conference on the role of special economic zones in sustainable ocean development at the Monaco Ocean Week, on March 24, 2021 between 2:00 PM – 17:30 PM CET. Link for free invitation here.

To get more familiar with the positive impact of Free Zone of the Future on Blue Economy, Zoë Harris has accepted to share with us her article entitled “How can Special Economic Zones Advance the Blue Economy?” which is introducing free zones in general, and 2 cases studies of international projects (export & luxury tourims) supported by the World FZO’s.

FREE ZONES

Free zones are designed to attract foreign direct investment, to support knowledge transfer, to generate employment and to drive upgrades in the host economy, mostly through export stimulus.

The net economic contribution of free zones has been a matter of debate, primarily due to a lack of measurable data that could be compared across regions and industries. Several countries across the globe are considering closing some of their free zones out of concern that their contribution to the domestic economy may not have been significant enough. In other words, free zones are supposed to create value for the governments that build them. It is more crucial than ever that a free zone generate this value in order to justify its existence.

Offering looser environmental regulation in free zones is no longer a viable solution. The 17 UN Sustainable Development Goals have become a standard to track environmental impact in global ventures. Businesses now use their green development strategies as marketing hooks of credibility to lure customers and clients. Infrastructure, policies and processes in free zones must now incorporate a sustainable component to be truly competitive on the world stage, and allow their client companies to do so too. This requires either adaptation or redirection when developing and managing free zones. The right approach to sustainability will generate solid, long-term value for the host economy.

Patterns of international production and global value chains are changing. UNCTAD’s latest World Investment Report cites rising protectionism and shifting trade preferences as reasons to prompt international cooperation on free zone development to face this challenge. This should give rise to more regional and cross-border zones, which in turn signals a shift towards international collaboration between governments to generate value in free zones.

The public and private sector can both benefit from free zones as they create value together. Governments have handed over the development, operation, and sometimes ownership of free zones to private companies to either mitigate costs or simplify administration. To be successful, public and private sectors must listen to each other and find common ground to build the right blend of infrastructure, regulation and incentives that will unlock synergies and invite the kind of investment that free zones are meant to attract.

How can Special Economic Zones Advance the Blue Economy?

71% of the Earth’s surface is ocean, and billions of people depend on the oceans for their livelihoods. Maritime transport remains an essential part of international trade as over 90% is carried by the seas, and about 40% of global trade is channeled through special economic zones.

The renewed attention on the ocean in recent years is reflected in the UN Sustainable Development Goals, as goal number 14 aims to “conserve and sustainably use the ocean, seas and marine resources for sustainable development”.

The blue economy is of growing importance and gaining momentum amongst policymakers across the world. This is not surprising as the ocean is a significant wealth generator estimated at an annual value of $1.5 trillion per year, making it the world’s seventh largest economy.

“If the ocean were a nation, it would rank as the 7th largest economy in the world. The Blue Economy is sustainable ocean development.  It highlights an overall-planning and coordinated development between marine ecosystem and ocean and coastal zone economic system in which SEZs can play an important role.”

Zoë Harries, World FZO’s Project Director

Significant contributions of marine and freshwater ecosystems include food security, nutrition and health, livelihoods, mitigation of climate change, homes and shelter, trade and sustainable economic growth. Challenges undermining the blue economy include overfishing, habitat degradation, climate change phenomena, unfair trade and ad hoc development.

Significant contributions of marine and freshwater ecosystems include food security, nutrition and health, livelihoods, mitigation of climate change, homes and shelter, trade and sustainable economic growth. Challenges undermining the blue economy include overfishing, habitat degradation, climate change phenomena, unfair trade and ad hoc development.

BUSINESS CASE

The World FZO’s Free Zone of the Future (FFZ) Program support sustainable ocean development. Its signature Izdihar Index offers free and special economic zones a framework to achieve their full performance potential, accelerating value creation and fostering regional prosperity.

The FFZ is based on three main pillars of excellence : Best Practices, Entrepreneurship & Innovation and Sustainability. The Izdihar (Arabic for “prosperity”) Index monitors 45 indicators of progress. The indicators are qualitative, measuring a zone’s degree of achievement in given fields of ‘best in class’, innovation and sustainability and the related SDG touchpoints. The United Nations’ Sustainable Development Goals (SDGs) for 2030, seek to end poverty, protect the planet and ensure prosperity for all.

Business Model Eco-Industrial Park / Export Processing Zone in the Nordics

For Nordic energy company we developed a business model an Eco-Industrial Park/ Export Processing Zone, built on the principles of the Blue Economy, creating a manufacturing hi-tech cluster based on industrial symbiosis.

Inspired by “The Incredible Fish Value Machine” that displays how Icelanders have produced “an industry fishing machine” which takes pride in the fact that no other whitefish nation is utilizing more of each fish than Icelanders. The Icelandic model has proved reliable, and this model can be duplicated in seafood industries all around; creating new opportunities in coastal areas. The zones’ sustainability proposition allows qualification for blue finance.

‘Regenerative’ Tourism SEZ, The Red Sea Project, Kingdom of Saudi Arabia

Within its Vision 2030, the Kingdom of Saudi Arabia has spearheaded special economic zones as key enablers to attract foreign investments for sustainable economic growth.

The Red Sea Project, a ‘Regenerative’ tourism SEZ, is a luxury tourism destination that brings together nature, culture and adventure. With its 100% environmentally responsible renewable energy, water production, wastewater treatment and district cooling, Saudi Arabia is setting new standards in sustainable ocean development.

Article : Zoë Harris – Project Director – World FZO / Sources: Sources: https://www.weforum.org/ ; http://www.sjavarklasinn.is/en/ ; https://www.theredsea.sa/en ; https://www.worldbank.org/en/home ; https://www.impact-zones.com/

Post Author: Wealth Monaco