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Special Economic Zones in Africa
Box 6.1
Evolving Economic Zone, Trade, and Investment Policies to Meet Changing Needs in Mauritius Mauritius strategically aligned its diversification and industrialization strategy with the international trading regime, capitalizing on its labor costs and its cultural proximity to European markets to create a specialized, attractive investment microclimate in its EPZ. However, this trade and investment strategy has not been static. Initially, the EPZ was a liberal enclave inside a highly protected economy. Over time, in parallel with the erosion of preferential trade access, the country’s own trade and investment regimes were progressively liberalized, and the EPZ became less of an enclave and more of a catalytic exclave. The EPZ has retained much of its focus on the garment sector—it is the world’s second largest producer of knitwear, the third largest exporter of pure wool garments, and the fourth largest supplier of T-shirts to the European market. But liberalization in the trade and investment regime has allowed for diversification outside the EPZ in line with the island’s evolving comparative advantage, including the launch of the offshore financial sector and the free port in the early 1990s, the Cybercity/ICT initiative in the early 2000s, and the integrated tourism resort scheme in the mid-2000s. Source: Author.
the office of the prime minister or head of state. The African programs in our study show some evidence of having been given institutional prominence and of leaders periodically promoting the programs in public. However, consistent personal championing of a zone program is rare in the African context. Two exceptions are Ghana (where the free zone program was a personally championed, at least in its early years, by President Jerry Rawlings) and Senegal (where Karim Wade, a politician and son of the president, is one of the leading figures involved in implementing the Dakar Integrated SEZ). Institutionally and strategically, successful zone programs have been an integrated component of a long-term national growth (trade and industry) policy framework. Thus, the policy instruments must be flexible enough to adjust to the evolving needs of the country. The successful East Asian countries situated their zones within a clear industrial policy framework, which had two important implications. First,