usually reduced to the provision of a legal framework with generous tax incentives and other concessions. Some would say this is just fine, that the global market for zone developers and operators is simply at play, that market forces are doing their things, and that governments are acting wisely. Yet, there is little evidence from the cases I have seen that market forces are at play. To the contrary, often market forces are avoided through non-competitive practices that eliminate the possibility of choice and bypass open bid processes. These projects, in my view, fail to pass the test of public utility because such utility cannot be demonstrated ex ante through an objective, independent, iterative process of goal definition, configuration and validation. The country gets selected, for reasons often unknown and unquestioned, and gets whatever it can get. The absence of a formal framework of evaluation means that government does not have a benchmark against which to test and validate the project, and has no tool to assess whether it is getting a fair deal out of it or not. This is all the more concerning because zone projects tend to come with high direct costs to governments, as they usually come with requests for infrastructure investment, population resettlement, utility subsidies, tax incentives, and the likes. Zone projects also come with high opportunity costs: there is rarely the economic space for more than one or two zones, and poor cost-benefit performance will have a very negative impact on the economy, the political economy, and future efforts at developing similar projects – even if properly structured. Stated simply: zone projects are too strategic to be allowed to fail through a lack of endogenous anchoring and the absence of a proper planning and validation process. These projects also are highly likely to fail. The quid pro quo between governments and developers is usually untenable because it is usually based on unacknowledged, unspoken, contradictions in goals and means. Often, terms of understanding are loosely defined, without appropriate performance benchmarks, be it in terms of timelines, sums invested, sectors targeted, infrastructure delivered, investment promotion, and so on. Where benchmarks are defined they often cannot be executed because contracts are inadequate. Exit clauses either do not exist or are not enforceable. Today’s model zones in Asia, Latin America and the Middle East are the very illustration of the power of endogenous anchoring. These zones took the best other zones in other parts of the world had to offer, hired the best advisors they could get, and combined these with their own best technocratic capabilities driven by a clearly expressed and sustained political commitment from the top. These then newcomers set their own sovereign socioeconomic objectives, and devised zone development processes that best fulfilled these objectives. More often than not this was a slow, time consuming, and laborious process. I am sure
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