FTZ moves ahead
SOUTH POINT — Although early in the process, the trading tool granted to a local industrial park has some local leaders excited.
Local economic development leaders continue to work toward making The Point industrial park’s new Foreign Trade Zone designation a tool for increased foreign trade, but it could take a year or more until local businesses see results.
An FTZ is an area within the United States that the government considers outside the country, or at least, outside of U.S. Customs territory.
This allows businesses to import certain types of merchandise without going through formal customs entry procedures or paying import duties.
It also reduces many export costs or cuts them out all together, depending on the product and business.
The Point was designated as an FTZ last month, but will not be officially activated for at least six more months.
Steve Story, of Global Trade Solutions LLC, was on hand Friday at the Greater Lawrence County Area Chamber of Commerce to talk to local business leaders about the FTZ designation.
Although based at The Point, the FTZ
can extend up to a 50-75-mile radius and can include other counties such as Scioto and Lawrence, Story said.
Other adjoining states also may jump on board, with state permission.
“The main purposes of an FTZ are to attract companies that are looking to relocate and to bring foreign companies into the area,” said Story, who serves as a consultant to numerous FTZ projects in the country.
He said foreign trade has exploded over the past few decades, which is why FTZs are so important — they give their areas an edge over their competition because locating there is more cost-effective, he said.
Once merchandise has moved into an FTZ, just about anything can be done with it. Goods can be displayed, re-packaged, repaired or destroyed.
Component parts can be assembled into finished products and either the parts or finished products can be re-exported.
For example, car stereos can be imported with no duty rate, assembled in an FTZ and then shipped out of the Zone to domestic customers with a reduced duty rate. Story said the benefits of the FTZ vary depending on a number of factors.
There are 270 such zones in the U.S., he said, 10 of which are in Ohio. The Point’s FTZ does have three major advantages over most of those areas, Story explained — access to river, road and rail.
Lawrence County Commissioner Doug Malone said he hopes the Zone will attract new industry and jobs, as well as put existing businesses on a level playing field with them.
“Many times you have new businesses come into the area and get tax breaks, but the companies that have been here don’t get anything like that,” Malone said. “It’s just a great opportunity all-around for Lawrence County.”
Bill Dingus, executive director of the Chamber and the Lawrence Economic Development Corp., said he hopes the FTZ will give the area what it needs to compete in the global market, which, hopefully, means more jobs coming into the area.
“We are very excited about the possibilities,” he said.
Marsha Estep, with Valley Supply in The Point, agreed that the FTZ could be huge for the area.
“It’s going to be great, not only for our business, but for other local businesses as well,” she said. “We’ve lost so much industry and this helps us compete to bring jobs back in here.”