Financial Action Task Force

• They include export processing zones, free trade zones, special economic zones and industrial free zones.
• The success of freeports in growing local manufacturing and economies is exemplified by countries like Malaysia and Singapore.
• The Conversation Africa’s Godfred Akoto Boafo interviewed transport economist Jonas Aryee, who has studied freeports in west Africa.

What is a freeport?

• Imports can enter with simplified customs documentation without paying tariffs.
• Imported raw materials or components may be stored or processed duty-free pending re-export, or duty-paid on entry into the importing country or when sold locally.

Why are they established?

• The purpose is to manufacture goods using imports, add value, and re-export the finished product without paying the full tariff on the original import, whether it be raw material or semi-finished goods.
• They can increase: foreign exchange earnings job opportunities income generation foreign direct investment technology transfer exports (thus improving the balance of payments).
• The UK revoked the policy in 2012 but is having a go at it again.

What negative consequences can they have?

• Authorities may be lenient in attracting users, which can lead to illicit financial flows, illicit goods and tax evasion.
• Firms may misuse the special privileges by conducting transactions of their non-freeport associates through the freeports to evade taxes, as reported in Ghana.
• The EU found the special duty and tariff status has encouraged organised crime, money laundering and terrorism financing.

Which are the best performers in west Africa?

• Countries may set them up to boost employment, attract foreign direct investment or as part of an economy-wide reform experiment, like the gateway project in Ghana.
• Even more challenging is to get data on employment creation, foreign exchange through exports, economic value added and technology transfer.
• In 2022, Senegal, Ivory Coast and Ghana were the top recipients of FDI in west Africa.

Which are the worst?

• SINGAPORE, May 13, 2024 /PRNewswire/ -- XREX Singapore , a blockchain-enabled financial institution specialising in cross-border payments in emerging markets, announced today that it has obtained the Major Payment Institution (MPI) Licence from the Monetary Authority of Singapore (MAS), the nation's central bank and financial regulator.
• With this licence in hand, XREX Singapore will endeavour to bring blockchain-enabled digital payment currencies to ubiquity."
• XREX Singapore's licence encompasses a total of six payment services, namely:
  ii) Domestic money transfer service;
  iii) Cross-border money transfer service;
  vi) Digital payment token service.
• With XREX Singapore as the group's Asia Pacific headquarters, XREX looks forward to expanding its partnership with major banks, credit card institutions, and payment institutions to build next-generation financial systems that integrate traditional and blockchain finance," said XREX Co-founder and Group Chief Revenue Officer Winston Hsiao.

• The Assembly APAC 2024 will offer attendees expert guidance and practical insights, addressing how the region’s AFC professionals can prepare for the latest regulations and meet compliance expectations.
• The Assembly APAC 2024 will feature a session wherein regulators will share their views on current developments in the region.
• "The Assembly APAC will offer invaluable insights essential for compliance professionals grappling with growing regulatory requirements and emerging illicit-finance threats that continue to reshape how AFC compliance is conducted," said ACAMS CEO, Neil Sternthal.
• For more information on The Assembly APAC 2024, including access to the agenda and registration portal, please visit https://www.acams.org/en/events/the-assembly/the-assembly-apac .

• The integration with the CODE Travel Rule solution is a testament to Toobit's dedication to compliance, safety, and the provision of technology-based solutions that not only meet but exceed the international standards for anti-money laundering (AML) compliance.
• The Financial Action Task Force's Travel Rule is a critical regulatory standard aimed at curbing money laundering and terrorist financing.
• By partnering with CODE, a Travel Rule solution embraced by major exchanges, Toobit demonstrates its commitment to the highest levels of compliance and security.
• The cryptocurrency community warmly welcomes Toobit's integration into the CODE alliance, a testament to its dedication to enhancing the trading environment through compliance with global standards.