This document discusses how free trade zones (FTZs) can facilitate the growth of aerotropolises through mutually beneficial relationships. It provides examples of the first airport-FTZ pairing at Shannon Airport in 1959 and how current airport-FTZ relationships support billions in trade. FTZs attract businesses that rely on international trade networks, complementing airports. International alliances between airports and FTZs could further maximize connectivity and trade opportunities globally through cooperation frameworks. The future may see a global network of airport-FTZ alliances supporting enormous growth in international air trade.

1. Facilitating Aerotropolis Growth
Through Enterprise and Free Trade
Zones, International Alliances and
Trade Agreements
Peter Budd
Director Aviation and Chairman UKTI Airports Advisory Council
9th July 2014

2. Free Trade Zone
• Special class of economic zone.
• An area without the intervention of
customs authorities.
• Conducive to international trade.
• Benefits:
 Duty exemptions/ deferral.
 Supply chain benefits.
 Currency exchange benefits.
 Liberal business structures.
 Inventive tariff relief.
• Value of Global Air Freight –$3 trillion
Source: Arup Analysis
Financial/Economic Advantages of the Free Trade Zone and Geographic
Advantage of the Airport.

3. • 1959 – means of economic stimulation.
• Adjacent to Shannon International
Airport.
• Importance of the airport to the FTZ was
recognised
• Airport as a crucial connection -
Facilitating trade with the USA.
• Free Trade Zone  Airport City.
• Currently:
 €3 billion of sales within the
zone annually.
 100 multi-nationals.
 6,500 employees.
Source: Irish Dept. of Finance
First ever pairing of an airport and free trade zone.
Shannon Free Zone – World First

4. Abu Dhabi International Airport, Free Trade Zone
Mutually Beneficial Relationship
Source Arup Analysis
Source: PDMC.com
Mutually Beneficial Relationships
• Airports and FTZs – Symbiotic relationship
• FTZ: Dependency on international trade
networks.
• Coupling the benefits of the FTZ with an
international airport.
• FTZs – Attract enterprise and business,
especially internationally operating and
transport reliant commerce:
 Development of the Aerotropolis.
 Opportunity for cargo and passenger
services.
 A direct non-aero revenue stream for the
airport.
 The FTZ supports the aerotropolis and
the aerotropolis supports the FTZ.
 This relationship supports continued
growth.

5. • FTZ supports the initial growth of the
aerotropolis.
• Risk of reliance on FTZ.
• Aerotropolis growth from new enterprise
and supporting commercial activities –
shift away from reliance on FTZ.
• Attracting added value for the
aerotropolis through industries such as:
 High value manufacturing.
 IT related industry.
 Air cargo park.
 Medical services.
 Logistics and distribution centres.
• Complementary to air freight reliant
businesses. Taoyuan Airport, Taiwan, Free Trade Zone
Source: cifatlanta.com
Aerotropolis Growth – Attracting Added Value

6. • Taoyuan Airport, Taiwan.
• Incheon Airport, Korea.
• Dubai International Airport, UAE.
• Dallas/Fort Worth, United States.
• Gauteng Province, South Africa.
• Willow Run, Detroit, United States.
Growth in China of the FTZ
• In China the FTZ at Shanghai Airport is
expected to serve as a laboratory for
testing out the free zone concept.
• Great opportunity for global trade
relations and international development –
alliance opportunities.
• Governance issues - 3 year roll-out
expected.
Dubai Airport Free Zone
Source: dafz.ae
International examples of Aerotropolis Free Trade
Zones

7. • Establishing formal agreements between
airports to support FTZ and aerotropolis
growth – Mutually beneficial.
• Maximising connectivity between
aerotropoli – establishing a network of
free trade zones.
• International development opportunities.
• Maximising trade opportunities and
connectivity.
• Collaborative and skills sharing
opportunities in the manufacturing sector.
• Potential wider economic trade benefits
to the participating countries in the
alliance.
• Mechanisms for alliance– formal
agreements including, Economic co-
operation framework.
Incheon Aerotropolis, free zone.
Source: businessfacilities.org
Source: airport.kr
International Alliances – Co-operative Business
Channels

8. Source: Arup Analysis
Dallas/Fort Worth – Building Global Alliances with
Aerotropolis Free Trade Zones.

9. The Future of the FTZ/Aerotropolis Alliance
A potential network of aerotropolis/FTZ alliances
Source: Arup analysis
• Aerotropolis – FTZ relationship:
Recognition of the enormous benefits.
• Expected global growth of the FTZ and
aerotropolis pairing.
• Development of FTZ’s in Latin America,
Russia, Asia and Africa will strengthen
global air trade in developing markets.
• International trade agreements will
support links between continents and
regions.
• Further alliances will establish a global
network of FTZs, maximising upon the
increasing value of air freight.
• Supporting the global economy and
growth in trade.