FACTORS DETERMINING THE NECESSITY FOR A TRANSIT TRADE ZONE
The factors determining the necessity for a transit Trade Zone in the Varna region can be summarized in two main groups:
A Financial factors
- In view of the fact that the financial institutions in the region do not manage to provide the necessary credit resources for the development of the small and medium size business, any form of postponing the customs and taxation dues would bring a stimulating the development effect to the industrial unit helping it to synchronize the realization of the goods with the terms of taxation
- The establishing of joint industrial units is also prevented by the chronic lack of investment and working capital. Most often the foreign partner is ready to offer a commodity credit for production resources to a local trade or industrial unit but the local businessmen are unable to pay the due taxes on import of the goods. In this respect the Zone is the suitable place to start a production process to the completion of the product and its export to neighboring markets.
- A traditionally developing branch as ship repairing is also affected by the financial factors due to the long-term supplies of spare parts and the value added tax collected before their realization.
B Factors connected with the logistic capacity of the region
- Varna is a traditional port center having the necessary transportation infrastructure for meeting the cargo flows and distributing them along the basic transport corridors. The international experience points out that for activating the cargo flow a broad specter of possibilities should be offered, including a Transit Trade Zone. With the establishing of the Zone the interest in the regional transportation and port infrastructure is expected to grow.
- Port Varna is an important transportation and forwarding center as it is geographically situated at the end of the Trans-European Corridor No 8 and is well bound by road, railway and sea communications.