Economy, Domestic Economy

$300m Foreign Investment in Aras Free Zone

$300m Foreign Investment  in Aras Free Zone $300m Foreign Investment  in Aras Free Zone

Aras Free Zone has absorbed $300 million in foreign investment thus far through discussions and endorsement activities carried out with the help of Iranian embassies in different countries, announced the CEO of Aras Free Zone, Mohsen Khadem Arab-Baghi on Friday.  

"The aim of establishing free zones across the country is to boost economic activities and attract foreign investment," IRNA quoted Arab-Baghi as saying. Currently, 15 foreign industrial companies have been established and nearly 400 new industrial units are under construction in the northeastern free zone. These new units will create job opportunities for seven thousand people.

Noting that the majority of foreign investments are in the agricultural sector, with 137 thousand hectares of agricultural lands offered to qualified investors, Arab-Baghi said the National Development Fund (NDFI) will be providing incentives to investors in the agricultural sector.

Stressing the need for the presence of foreign banks in free zones, the official said: "New commercial banks must be opened in the free trade zones if we are to attract investors."

"Generating funds and liquidity is often a major issue for the production units in various free zones across the country. However, tax exemption on economic activities carried out  in Aras Free Zone, adjacency to foreign markets and ease of export have made the zone ideal for production units," Arab-Baghi observed.

The official however pointed that some production units in the area find it increasingly difficult to compete with their foreign counterparts in light of the fluctuation in raw material prices and increased production costs. "These production units are in dire need of support from government and banks to finance their production activities," he noted.

Aras Free Zone has been able to make considerable progress in recent years in the fields of manufacturing, industry, export, agriculture, mining, business and commerce; thus, the businessmen and investors from neighboring countries can benefit from the advantages offered by this zone to boost economic ties with Iran.

Noting that the zone seeks to increase the volume of non-oil exports, the official said the majority of the imported products in this zone are basic and semi-finished goods. "Imports of finished products were reduced through increasing the customs duties and commercial charges," he noted.

Tax exemption on various economic activities for 20 years since the operation starting date, exemption from customs duty and commercial charges on import of raw materials and machineries, possibility of sending the manufactured products into the mainland while upholding the added vale  rules, exporting with minimum formalities, re-export opportunities for goods-in-transit and allowing for 100% foreign investment (without an Iranian partner) are among the advantages offered to the investors in Aras Free Zone.

Aras Free Zone is located in northwestern Iran at the border point neighboring Armenia, Azerbaijan and Autonomous Republic of Nakhchivan. The area was expanded on 4 December, 2008 to 51,000 hectares to include some parts of Julfa and Kaleibar towns.