Belize Commercial Free Zone

Topics: United States dollar, International trade, Currency Pages: 5 (1363 words) Published: April 17, 2013
The Commercial Free Zone

Sign to entrance to CFZ

Map layout of CFZ

Plazas, Company Stores & Shoppers inside 'The Zone.'

Group # 7/ D
Research Question:
Identify an industry or economic area with in your country where taxation and protection as been removed and look at the condition of it with in your country in terms of: 1. has it worsen or improve

2. variety of choice ( no specification of products made) 3. price of goods ( no indication of the prices of goods) 4. overall employment
5. quality (no indication of the quality of goods)
6. government revenue
7. local industry

A Brief over View of the Commercial Free Zone or CFZ

The Commercial Free Zone is one of Belize’s many Offshore Companies or industries used to attract foreign investors from all over the world to increase Belize’s economy and northern economy. Belize's legislation defines CFZ as "a geographic area in Belize designated outside national customs territory and duly restricted by controlled access, wherein the benefits created shall apply to a complex of industries." The CFZ boarders Mexico’s South Eastern border and allows investors to directly access Mexico’s high end consumer market. Corozal’s Commercial Free Zone is under the management of the Commercial Free Zone Management Agency (CFZMA) and is headed by the Chief Executive Officer under a Board of Directors within the Zone. The Commercial Free Zone (CFZ) was established under the Corozal Commercial Free Zone Act of 1994 and was in place by 1997.

The FZA is the most modern laws governing Free Zones in Belize. Business entrepreneurs are offered insane tax free business opportunities. Businesses there are free of foreign exchange restrictions and benefits such as duty exemptions and tax holidays. Goods imported or exported are exempt from any duties, quotas, stamp duties and revenue replacement duties. Income tax on Commercial Free Zone businesses is usually charged between 2% and 8%. Businessmen’s rates can be reduced up to 2% through tax credits by employing Belizean workers. The Zone provides a variety of facilities for activities such as manufacturing, processing, warehousing, packaging and distribution of goods and services. This allows the businessmen today to manufacture, import, export, distribute fuel, and to offer retail or wholesales to Mexico and many other international clients. By doing so, they are also offered access to dock ships at ports in Belize and direct export by sea, air, land and entry into national customs territory.

Today the Zone under gone vast improvement since then and continues to do. What started out first as a private sector with a great struggle to attract investors began to pay off due to the involvement of the few businessmen’s determination and dedication. First there were a few companies that only imported and exported their merchandise, then one or two retail stores, and then there was the addition of a SHELL gasoline station. This then offered the Mexicans an economical and better quality fuel than Mexico’s state-run fuel company PEMEX offered. Mexicans then began to invest in the Zone and brought with them numerous stores which offered investors and consumers everything from a more active store location to batteries.

Benefits that Foreign Investors Receive from CFZ

The following is an extended list of benefits that Investors receive: 1. no restrictions on foreign exchange out of or within a CFZ, including the sale of foreign currency or the transfer of foreign exchange; 2. no Government charges and taxes on foreign currency use within a CFZ; 3. all merchandise, articles and goods that enter a CFZ for commercial purposes are exempt from import duties, revenue replacement and stamp duties; 4. all fuel and goods, including buildings materials, equipment, furniture, supplies, etc., needed for the functioning of a CFZ business are exempt from all duties and...
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