- Free trade zones will open gate to booming common markets -

Bordering the Red Sea and destined to cover hundreds of square kilometres lies the basis of Sudan's future. These are the Sudanese free trade zones, which have been in the planning stage for many years and are only now being realised. This region is known for its harsh environment, where water drawn from the Red Sea has to be desalinated to supply the growing population, but it contains the beginnings of an industrial base for one of the world's least-developed countries. The free trade zones will be the focus of, not only Sudanese, but also eastern and central African imports and exports.

The Sudanese Free Zones & Markets Company (SFZMC) was established seven years ago by presidential decree to operate the zones in two major areas: the Red Sea coast and Al-Gaili, north of the capital, Khartoum. A four-phase master plan for the Red Sea Free Zone (RSFZ) was drawn up in collaboration with the Chinese government, which would have an initial phase of one million square metres, hosting industrial, commercial and other services. Construction began in 1998 and the RSFZ was in operation by the summer of last year.

The RSFZ extends from Port Sudan to the other main port at Sawakin. Spanning some 26 sq km, it is planned to eventually cover a region of around 600 sq km. Around 90 licences have already been granted to investors - mostly for commercial activities - from Sudan, Saudi Arabia, Qatar, United Arab Emirates, Jordan, Syria, Yemen, Japan and Chile. The RSFZ is being promoted as the gateway to the booming Common Market for Eastern and Southern Africa (Comesa), of which Sudan is a member.

Surrounded by five countries which make up half the 300 million population of Comesa, Sudan has declared a zero customs rate. This will enable free trade mobility for the member states. A scheme for the Al-Gaili Free Zone (AGFZ), being drawn up with Irish assistance, is near completion. The plan is to set up petrochemical industries in the AGFZ. The free zones offer an excellent range of incentives for investors, including full repatriation of capital and profits, zero personal income tax, no corporate tax for 15 years (renewable), and no restrictions on entry or length of stay.

Investors will receive a free land lease

ABBAS 'Sudan has plenty of resources that we must develop' Mohamed Abbas, director general of the SFZMC, says the areas are also designated as export-processing zones (EPZ). "Sudan has plenty of resources and we need to develop them. We need the EPZs for manufacturing and to add value to our raw materials in order to build the economy." Investors will be given free land leases for factories, warehouses and offices, and operators will have 100 per cent ownership. "There is a cost-effective labour supply, abundant resources and low-cost raw materials," says Mr Abbas. Manufacturers using a minimum of 40 per cent of Sudanese raw materials in their products will be entitled to a 'Made in Sudan' certificate of origin, and they will be able to export tariff-free to Comesa members.

"We feel that relations between Sudan and Western Europe, as well as with other countries, are going well. We want to be ready for the new trade that will come here, particularly now that oil has been discovered," says Mr Abbas. "I think the preferential market of the regional economic group Comesa will attract companies here, even from America, because there is a potential market of more than 300 million people. The world is now a global market, but the problem is finding a place to sell your goods."