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Clarification of certain FDI incentives currently under consideration by the METE

General Investment Context (as currently foreseen) . Reduced corporate tax (17% in 2009)Major / transformational investment result from:Regional FTZConcessionsPrivatisationNo need for a dedicated law on FDI incentivesOnly targeted incentives, to be inserted in codes / laws concerned (tax, l

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Clarification of certain FDI incentives currently under consideration by the METE

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    1. Clarification of certain FDI incentives currently under consideration by the METE Karim Medjad Andrew Thorburn EC-UNDP Cards 2002 Support for Trade Regulation and Promotion

    2. General Investment Context (as currently foreseen) Reduced corporate tax (17% in 2009) Major / transformational investment result from: Regional FTZ Concessions Privatisation No need for a dedicated law on FDI incentives Only targeted incentives, to be inserted in codes / laws concerned (tax, labour, education…) Each incentive to be monitored by the Ministries concerned (finance, labour, education, industry…)

    3. Incentive package 1 (Low) Target job market 2 possible incentives: Job creation in disadvantaged areas and / or Vocational training deductible as expense

    4. Incentives package 2 (High) Target job market + specific industries 2 industries under consideration by METE: Textile Leather / shoe

    5. Detail of incentives: job creation in disadvantaged areas (1) Advantages Strong incentive State-aid compliant Reduces informal sector Strong PR impact Disadvantages Costly (reduces state income) Complex / expensive to implement / monitor

    6. Detail of incentives job creation in disadvantaged areas (2)

    7. Detail of incentives: develop skilled labour (1) Advantages Strong incentive State-aid compliant Reduces informal sector Strong PR impact Disadvantages Costly (reduces state income) Complex / expensive to implement

    8. Detail of incentives develop skilled labour (2)

    9. Detail of incentives specific industries (1) Should textile and leather / shoe industries be incentivised?

    10. Detail of incentives: targeted industries (1) Advantages State-aid compliant Reduces informal sector Narrow target: strong signal towards industries concerned Disadvantages Industrial park are long to set up Not autonomous (success depends on additional factors – e.g. infrastructure) Complex / expensive to implement

    11. Detail of incentives targeted industries (2)

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