What are foreign trade zones? How are they used?
Chapter 18 Global
Production and Supply Chains
#Daniels #15edition #GlobalProductionandSupplyChains #GlobalProduction #SupplyChain #Chapter18International Business: Environments and Operations, 15e, Global Edition (Daniels et al.)
Daniels, 15edition, Global Production and Supply Chains, Global Production, Supply Chain, Chapter18
Answer: FTZs are areas in which domestic and imported merchandise can be stored, inspected, and manufactured free from formal customs procedures until the goods leave the zones. The zones are intended to encourage companies to locate in the country by allowing them to defer duties, pay fewer duties, or avoid certain duties completely. Sometimes inventory is stored in an FTZ until it needs to be used for domestic manufacture. FTZs can be general-purpose zones or subzones. A general-purpose zone usually is established near a port of entry, such as a shipping port, a border crossing, or an airport, and it usually consists of a distribution facility or an industrial park. A subzone usually is physically separate from a general-purpose zone but is under the same administrative structure.
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