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Free-trade zone, also called foreign-trade zone, formerly free port, an area within which goods may be landed, handled, manufactured or reconfigured, and reexported without the intervention of the customs authorities. Only when the goods are moved to consumers within the country in which the zone is located do they become subject to the prevailing customs duties. Free-trade zones are organized around major seaports, international airports, and national frontiers—areas with many geographic advantages for trade. Examples include Hong Kong, Singapore, Colón (Panama), Copenhagen, Stockholm, Gdańsk (Poland), Los Angeles, and New York City. Alternative devices such as the bonded warehouse and associated systems are used in some large seaports (e.g., London and Amsterdam).

The primary purpose of a free-trade zone is to remove from a seaport, airport, or border those hindrances to trade caused by high tariffs and complex customs regulations. Among the advantages of the system are the quicker turnaround of ships and planes through the reduction in formalities of customs examinations and also the ability to fabricate, refinish, and store goods freely.

Explanation:

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The "free zones" are defined areas of the countries in which the tariffs and procedures carried out are reduced in order to attract foreign investment.

Free Zones.

These areas are usually classified as widely commercial areas within a country, since their objective is precisely that, to be points of wide international trade, through the reduction of taxes and procedures, with which foreign investors see investment viability within of said place.

The history of free trade zones dates back to 1920, where Argentina is a pioneer, as a method to reduce poverty in a specific area in a developing country, in this way jobs will be increased in that place, and in compensation the foreign investor you will pay less taxes to the country.

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