SEZs, Blockchain and Refugees

SEZs, Blockchain and Refugees

Perhaps Lotta Moberg’s big idea is about locating Special Economic Zones (SEZ) right outside of refugee camps. Governments struggle to accept refugees because of their populace’s sentiments against hosting and feeding outsiders. But if refugee camps and SEZs can be co-located in locations that can be attractive to investors, then the host governments might see a net positive derived from a section of the refugees being productive.

Other noteworthy points about SEZs from Lotta’s presentation:

  • The Shenzhen SEZ is typically cited as the benchmark for how to do a SEZ right. This SEZ was created due to the desire of some Shenzen businessmen to trade with Hong Kong. So, it was a bottom up business driven initiative rather than a top down government driven initiative.
  • A SEZ was required for Shenzen because the kind of regulations that could be implemented in the pilot zone were politically impossible to implement on a country wide basis.
  • SEZs are featured by fiscal and regulatory benefits. Fiscal benefits indicate tax and tariff exemptions. If the SEZ is all about companies relocating from other locations to take advantage of these benefits, then the SEZ may not be beneficial to the country as a whole. This merely translates to government funded reallocation of resources.
  • SEZs should be considered as an avenue to test out Blockchain solutions. Using Blockchain and Cryptocurrencies for fiat money is a hot button issue for various governments. However, the technology can be applied to several other domains and limiting the experiments to within a SEZ could be a nice way to pilot these solutions.

Lotta’s book recommendations at the time of the podcast:

  • Richard Bookstaber, “The End of Theory”
  • Eric Beinhocker, “Origin of Wealth”
  • Adam Smith, “Theory of Moral Sentiments”
VM

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