The spread of tariffs as instruments of handling trade disputes has revived interest in
an old concept, that of the Foreign Trade Zone, writes Ian Putzger.
This past summer CargoM,
an organisation formed
in 2012 to promote
Montreal as a hub for
transportation, obtained FTZ
designation covering the entire
metropolitan Montreal area,
allowing companies to import
goods for manufacturing or
assembly duty-free for up to
four years. Plans at the Port
of Montreal to build a new
container terminal have been
one driver for the FTZ push, but
CargoM is in the trend of rising
interest in the concept.
In the west of Canada,
Edmonton International airport
has signed an agreement with
Plant Box, a China-based
company that specialises in
LED lighting systems designed
for indoor plant growth. The
company intends to use the airport as its gateway as well as the
base for its manufacturing and distribution across North America.
It chose the airport because of its round-the-clock operation, easy
access on a transpolar fl ight path and FTZ designation.
FTZs have been steadily gaining attention of late. “We’re seeing
an increase in interest in foreign trade zones,” confi rms Rebecca
Gammon, Manager of M-PACT Solutions, a fully owned subsidiary
of logistics provider Mallory Alexander. The US Foreign Trade Zones
Board has registered a steady rise in interest since 2016, she adds.
The trade dispute between the US and China has been a
major driver in all this. “Over the past year we’ve seen a 30-40%
increase due to the China tariffs,” confi rms Shanetta Griffi n, Chief
Commercial Offi cer of the Columbus Regional Airport Authority,
adding that further back tariffs on aluminium and steel had
prompted interest as well as some activity in the FTZ that covers
Rickenbacker International airport, the city’s all-cargo station.
Integrator interest too
UPS has also latched on to the FTZ theme. In September, the
integrator announced that it had expanded its customs brokerage,
warehousing, logistics and transportation business to include a
portfolio of FTZ consulting, management and fulfi llment services.
In addition, the company converted four of its major US air
There’s been a
of the benefi ts with
all the free trade
Mike Webber, Associate VP,
Landrum & Brown
28 December 2019 www.airlogisticsinternational.com