Free Trade Zones (FTZs) can lead to the growth of illicit trade, fraud
and money laundering if not well monitored, experts have warned.
According to the International Trademark Association (INTA), a global
association of brand owners and professionals dedicated to supporting
trademarks and related intellectual property, FTZs have also emerged as a
conduit for counterfeit goods.
Speaking during the Trade Week 2018 in Nairobi, last week, Hazel Okoth,
an advocate and member of INTA, said Kenya needed to place measures that
would ensure such malpractices do not occur.
“Moreover, limited institutional capacities to oversee FTZs activities
in many countries has led to the growth of illicit trade and other forms
of criminality such as fraud and money laundering,” said Ms Okoth,
noting that customs authorities needed to be empowered to closely check
what was going into the FTZ.
An FTZ is one of the special economic zones (SEZs) which Kenya intends
to use to power into a high middle-income economy by 2030.
reconfigured and re-exported under relaxed customs regulations without
being subjected to customs duty. Such areas are usually found around a
country’s major seaports and international airports. A good example is
the famed Dubai free port.
There are reports that Mombasa could get a free trade zone for motor
vehicles before the end of this year.
“In addition, under the Dongo Kundu Special Economic Zone, a free port
is under consideration on an approximately 3,200-acre parcel of land to
the West of the port of Mombasa,” said Treasury Cabinet Secretary Henry
Rotich in the 2018 Budget Policy Statement.
This would be a big boost to the ongoing development initiatives in
which the Government is keen on completing Phase I of the second
container terminal at the port of Mombasa to enhance cargo handling and
storage and reduce the time to clear cargo.
its eyes on growing manufacturing from the current 10 per cent of gross
domestic product (GDP) to 15 per cent by 2022, as part of his Big Four
agenda, President Uhuru Kenyatta has since established a multi-agency
team, whose function is to fight illicit trade.
goods worth Sh7.5 billion,” said deputy to the Head of Public Service
Wanyama Musiambo. The goods seized cut across different manufacturing