In early December, The Port of Virginia announced that the US Department of Commerce had approved Virginia’s application to expand the port area’s Foreign Trade Zone (FTZ) from 90 miles outside the port within the state of Virginia to 90 miles outside of the port’s boundaries into North Carolina. It hosts 17 warehouse, distribution, and production locations along with 71 firms utilizing the general purpose sites. “This is an incentive that can be used to attract business to the port and investment jobs to locations within the FTZ,’ John Reinhart, the CEO and executive director of the Virginia Port Authority, said in a statement. “The benefits of the FTZ can be significant, and this decision opens the door in northeast North Carolina to those benefits.”
FTZ’s are geographically inside the United States but are legally considered outside its customs territory. Companies that locate in FTZs can benefit from using special exemptions to encourage US economic activity by reducing, eliminating, or delaying duties. The Port of Virginia hopes this expansion of its nearby foreign trade zone will make the port more attractive to shippers since they have a larger footprint to avoid, or, at least, lower import duty costs. Read more.