WITH the Special Economic Zone Authority (SEZA) now operational, some businesses have expressed concern about its efficiency in granting licenses, but chief executive officer Stephen De Gannes and Permanent Secretary of the Ministry of Trade and Industry Randall Karim assure that there is no reason to fear.
A cross-section of the crowd at the Trinidad and Tobago Chamber of Industry and Commerce’s (TTCIC) discussion on “Private Sector Opportunities in the New Special Economic Zone” at its conference hall at Columbus Circle, Westmoorings.
—Photo: JERMAINE CRUICKSHANK
Answering questions during a panel discussion at the Trinidad and Tobago Chamber of Industry and Commerce’s (TTCIC) discussion on “Private Sector Opportunities in the New Special Economic Zone” at its conference hall at Columbus Circle, Westmoorings, Karim said the Special Economic Zone and its governing body have “a lot of predictability” as stipulated in the legislation.
“I think this is one of the pieces of legislation where we have defined into law – service standards associated with the application process. It’s actually a little better than a customer service charter because we have put a statutory responsibility on the SEZA and the Minister of Trade and Industry to grant licences within a clearly defined period of time,” Karim said.
Karim added that once an application is submitted to the SEZA, a specific timeframe is allocated for review and response.
If there are no issues, the applicant will also have the opportunity to address any queries from the SEZA.
After this process is completed, the minister will have 30 days to grant the license following the SEZA’s recommendation, he said.
“I will tell you that a lot of times with applications—and I’ve seen it all over the public sector system—because the quality is not as robust as possible, you find a lot of delays in the process,” he said.
Seeing this, Karim stated that the ministry has aimed to make the application process as clear as possible to ensure a smooth experience.
Regarding queries, he assured that SEZA will soon be issuing online explanatory guides and has hired a consultant, a former Republic Bank employee, to assist in this process.
De Gannes gave an example of the SEZA’s commitment to efficiency and said, “We received an application on a Friday after 4 p.m. and by Monday morning, we had gone through the application. Now the person seemed kind of eager and we wanted to give them feedback that at least we had received it. One of the staff members went through the checklist and we knew what it was missing, so within a couple of days, we were able to let them know what else was needed.”
De Gannes acknowledged the concerns, stating that he recognized some may have had negative experiences in the past; however, he said he is committed to working with the SEZA team to “make a difference.”
Part of the SEZ allows for the creation of Single Zone Enterprises – a designated area for businesses to operate and generate jobs—which raised the question, whether these will be established on State lands?
De Gannes responded, “Yes and no.”
He stated that SEZA has met with the Planning Division of the Ministry of Planning and has already begun disseminating the information and requirements necessary to establish these Single Zone Enterprises.
Karim added that conversations have not yet taken place with the Commissioner of State Lands (CSL) because the identified sites are owned by various state entities. He further explained that once an applicant has land not involving the State, Single Zone Enterprises can be established.
“Once the land is designated or has Town and Country Planning Division (TCPD) approval for a particular use, then that’s it, you’re in the clear. You’ll see in the application forms, one of the requirements we look for is the TCPD or lease approvals. CSL will only get involved if you don’t currently own the land and it belongs to the State,” Karim stated. “In the interim, we are okay because there’s a lot of land being held by the State agencies and entities and of course the private sector that will be used for the designated Single Zone Enterprises,” he said.
Karim said more will be explained in the September 30 National Budget Presentation.
About SEZ
The SEZ Act of 2022 outlines the designation, development, operation, and management of Special Economic Zones while repealing the Free Zones Act. Its primary purpose is to facilitate rapid economic growth by leveraging tax incentives to attract foreign investment and promote technological advancement.
The SEZ was fully proclaimed in July, and following this, the SEZA was established, led by De Gannes, the former CEO of the TTCIC.
Executive chairman of Ernest and Young Caribbean, Wade George, said the public, private and those who entered a public-private agreement can apply for incentives which include a 15% corporation tax rate, exemptions from import duties on certain items, property tax exemptions, zero-rated Value Added Tax on specific prescribed goods for use in the zone, and stamp duty exemptions on certain instruments.
An operator, however, is also entitled to all deductions and allowances under the Income Tax Act and Corporation Tax where applicable.
Regarding the application process, entities must complete a risk assessment questionnaire addressing anti-money laundering, countering the financing of terrorism, and financing the proliferation of weapons of mass destruction.
Additionally, they must provide evidence of sufficient financial resources to meet eligibility criteria, submit an operational plan for five years, give consent for inspector entry, comply with relevant regulations and permits, and pass an economic substance test conducted by SEZA to determine if the proposed operating expenditure, qualified full-time personnel, and investment levels are adequate, necessary, and relevant to the core income-generating activities.
George also explained the permitted activities within the zones, stating that Single Zone Enterprises and specialised zones allow for a variety of operations, including manufacturing, maritime services, aviation services, fishing and fish processing, agriculture and agro-processing, information and communication technology, creative industries, financial services, medical tourism services, renewable energy, logistics and distribution, and business process outsourcing.