New Free Economic Zone Namangan has been created in Uzbekistan. The decree on new FEZ was signed by the President of Uzbekistan on August 20, 2018. FEZ Namangan offers investor incentives for 30 years with the possibility of further prolongation.
Namangan is a city in the East of Uzbekistan in one of the densely populated region of Ferghana Valley. The population of Namangan region is almost 2 and a half a million. Namangan has been an important craft and trade center in the Valley since the 17th century. Currently Namangan is known as a center for light industry and food processing. There are 36 joint companies and over 400 small and medium enterprises only in the city of Namangan.
Reports say, that over $ 1.4 million will be allocated for the development of the infrastructure of Namangan zone, the construction of roads, fiber-optic communication lines, electricity, gas and water supply networks.
The list of incentives is impressive; the members of the free economic zone Namangan are exempt from payment of:
– land tax, profit tax, property tax of legal entities, tax on improvement and development of social infrastructure, a single tax payment for microfirms and small enterprises, as well as mandatory contributions to the Republican Road Fund and an extra-budgetary Fund for the Development of the Material and Technical Base of Educational and Medical Institutions under the Ministry of Finance of the Republic of Uzbekistan;
– customs fees (except for fees for customs clearance) for equipment, raw materials, materials and components, imported for their own production needs;
– customs fees (except for fees for customs clearance) for construction materials not produced in the republic and imported in the framework of projects;
As in other FEZs, these benefits are provided for a period of 3 to 10 years, depending on the volume of investments.
For example, from USD 300 thousand to 3 million incentives aregiven for 3 years;from USD 3 to 5 million – for a period of 5 years;from USD 5 to 10 million – for a period of 7 years; and finally anything above USD 10 million is free of tax for 10 years, with the application for the next 5 years of the income tax rate and a single tax payment of 50 percent below the current rates.
Moreover, participants of free economic zones:
– are exempted from payment of customs payments (except for customs clearance fees) for imported raw materials, materials and component parts in the part of products sent for export for the entire period of activity of free economic zones;
– have the right to carry out budgeting and payments in foreign currency inside the free economic zones;
– has the right to pay for the supply of goods, works (services) from other economic entities-residents of the Republic of Uzbekistan in foreign currency, as well as to use convenient terms and forms for payment and settlements for exported and imported goods.
Namangan Free Economic Zone is the 18th FEZ in Uzbekistan, a country which is actively opening up for international investments and exchanges.
Other FEZs are located in Navoi, Angren, Andijan, Jizzakh, Kokand, Gijduvan, Hazarasp, as well as Pharmaceutical Free zones as Nukus Pharm, Zomin Pharm, Kosonsoy-Pharm, Syrdarya Pharm, Boysun Pharm, Bustonlik-Pharm and Parkent-Pharm.