Xiangyu FTZ in China spread over an area of 2.36 square kilometers. This free trade zone of China started off its operations on 28th November, 1993. As a free trade zone, it emphasizes on the development of five industries as per the preferential policies allowed to units operating within the free trade zones in China. The units at the Xiangyu FTZ in China are allowed duty free processing in the filed of high technologies, repairs of mechanical and electrical equipments, classifying and packaging and other aspects of processing, storage of items and trading activities.
The Xiangyu free trade zone has offices from various departments like customes, commodity inspection, communications, banking and insurance. The setting up of their operations in this free trade zone has facilitated the further growth of the trade and manufacturing of units located within the zone.
Among the preferential policies which units at Xiangyu FTZ in China are assured of are as such:
Units can take decisions on the development, production and processing for transit trade and duty free storage of goods.
In addition to, distribution of import and export goods, management of wharf, commodity exhibition and other businesses all are allowed for the companies who function at the Xiangyu FTZ in China.
Goods, either exported or imported from the free trade zone here are allowed a policy of free entry from and exit to areas outside mainland China. They do not have to subscribe to the usual quota restrictions as is the case with most of the other units operating outside of the FTZ.
Units at the Xiangyu FTZ are allowed to open foreign currency account while keeping foreign currency as capital for the trading purposes. Further, 10% of the business tax of enterprises in the Xiangyu free trade zone is returned to the units.
The trade zone offers extensive duty free storage facilities. There are however, no separation facilities in the zone and units are accorded high security from external threats.
The companies registered in foreign lands have to form as independent legal entities and secure a license for doing trade, imports and exports from the Xiangyu FTZ in China. Irrespective of the nature of businesses and foreign trade handled by companies inside the Xiangyu free trade zone, all are treated as exports and relevant benefits are accrued to them.
Also, Companies are allowed to secure processing orders and enter into trade contracts with other units in the zone. They can also trade with companies outside the zone with designs, raw materials and equipments. Finally, units at the Xiangyu FTZ in China are allowed to purchase raw materials and semi-finished products made in China through domestic trade and processing inside the zone.
Xiangyu free trade zone is yet to realize its real potential. A lot of companies are still to develop their operations here. As against the other FTZs in China, Xiangyu FTZ is developing and expects to have more global units coming over here in near future and making a huge contribution to the growth of Chinese economy.
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