Zone: The Spatial Softwares of Extrastatecraft

Lujiazui Finance and Trade Zone, Pudong District, Shanghai, China.
Lujiazui Finance and Trade Zone, Pudong District, Shanghai, China. [Photo by Kamal Zharif Kamaludin]

Today urban space has become a mobile, monetized technology, and some of the most radical changes to the globalizing world are being written, not in the language of law and diplomacy, but rather in the spatial information of infrastructure, architecture and urbanism. Massive global systems — meta-infrastructures administered by public and private cohorts, and driven by profound irrationalities — are generating de facto, undeclared forms of polity faster than any even quasi-official forms of governance can legislate them — a wilder mongrel than any storied Leviathan for which there is studied political response.

One of these meta-infrastructures is the phenomenon of the free zone — a highly contagious and globalized urban form and a vivid vessel of what I have termed extrastatecraft. A portmanteau meaning both outside of and in addition to statecraft, extrastatecraft acknowledges that multiple forces — state, non-state, military, market, non-market — have now attained the considerable power and administrative authority necessary to undertake the building of infrastructure.

The zone — a.k.a., the Free Trade Zone, Foreign Trade Zone, Special Economic Zone, Export Processing Zone, or any of the dozens of variants — is a dynamic crossroads of trade, finance, management and communication. If, in the contemporary scene, diverse spatial types demonstrate the ways in which architecture has become repeatable and infrastructural, then it is the zone that demonstrates the ways in which urbanism has become infrastructural. Though its roots are ancient, dating back to the free ports of classical antiquity, only in recent decades has the zone emerged as a powerful global form, evolving rapidly from an out-of-way district for warehousing custom-free goods to a postwar strategy for jump-starting the economies of developing countries to a paradigm for glittering world cities like Hong Kong, Singapore and Dubai.

The zone is ancient and new.

The zone is heir to the history and mystique of the ancient free ports, pirate enclaves and entrepôts of maritime trade. The Roman port of Delos, in the Aegean Sea, which flourished in the first century B.C., is frequently cited as the primordial free port. 1 The Mediterranean fostered free ports for trade among Italian, Phoenician, Armenian and Muslim settlements for centuries. 2 From the 13th to the 17th century, in the Baltic and North Seas, the Hansa traders, or the Hanseatic League, established a network of “free cities” (including Hamburg, Bremen, Lübeck, Brügge, Köln, London, Danzig, Novgorod). 3 Hamburg and Genoa would remain models of the free port for centuries, able to evade the jurisdictional power of monarchies and nation states alike.

Hanseatic city of Stettin, Pomerania, 1588. [Map by Georg Braun and Frans Hogenberg]
Hanseatic city of Stettin, Pomerania, 1588. [Map by Georg Braun and Frans Hogenberg]

By the 17th century, a growing network of European free cities or free ports — including Naples, Venice, Trieste, Porto, Dunkerque and Copenhagen as well as Hansa cities like Hamburg, Bremen and Danzig — were trading with London, Rostock and Konigsberg. 4 In the late 18th and early 19th century, as trade extended to the Americas in a truly global network, the colonial powers of Spain, Portugal, Holland and Great Britain established free ports in South America and the Caribbean; these were followed by British and French free ports in Asia, Africa and the Middle East — Hong Kong (1841), Singapore (1819), Djibouti (1859) and Aden (1853). Eventually the activity of the Caribbean ports declined; but the Asian ports, notably Hong Kong, endured, and both Hong Kong and Hamburg remained global models into the 20th century. 5 In 1934 the United States passed the Foreign-Trade Zones Act. Based in part on the Hamburg model — and intended to alleviate protectionist restrictions on foreign trade — the zones allowed for the sorting and manipulation of goods; the “manipulation” might involve refining or curing processes as well lengthy holding periods that enabled the free-trade zones to engage in manufacturing, all of which made the zones distinct — with yet more freedom — from the bonded warehouses already permitted in the U.S. since 1846. 6 The first four authorized Foreign Trade Zones were in New York, New Orleans, San Francisco and Seattle. In 1950, the FTZ law was amended to unambiguously allow for manufacturing. Even so, up until the 1970s, only three more zones — Toledo, Ohio; Honolulu, Hawaii; Mayaguez, Puerto Rico — were created. 7

Poster for U.S. Foreign-Trade Zone No. l at Stapleton, Staten Island, New York, 1937. [By Jack Rivolta, WPA Federal Art Project]
Poster for U.S. Foreign-Trade Zone No. l at Stapleton, Staten Island, New York, 1937. [By Jack Rivolta, WPA Federal Art Project]

The specially tailored spatial instrument of the Foreign Trade Zone, which allowed manufacturing, would prove to be the forerunner of the Export Processing Zone, or EPZ — that extra-potent geo-political formula that in the postwar era spawned a global proliferation of extrastate entities. Hong Kong, as an EPZ, rebounded after the struggles of World War II and the Korean Conflict due to the high volume of exported goods. Shannon, Ireland, campaigned vigorously to attract manufacturing and service industries with 1947 and 1959 laws establishing a Customs-Free Airport and the Shannon Duty-Free Airport Development Authority. 8 In 1947, Puerto Rico, already tax-exempt in its dealings with the U.S., ventured to build manufacturing and warehousing facilities tailored to U.S. businesses. 9 In 1964, Mexico inaugurated the Border Industrial Program just as the U.S.-Mexican Bracero Program, or guest worker program, was expiring; the BIP authorized foreign companies to operate maquiladoras within a 20-mile strip along the international border and eventually throughout the country. Taking advantage of cheap, mostly female, labor, the maquiladoras were essentially inexpensive twins of the factories in the home country. Hong Kong and Shannon were in turn models for the Kaohsiung Export Processing Zone, or KEPZ, established in Taiwan in 1965. And Kaohsiung, along with Shannon and Hong Kong, was the template for extrastate zones in Ivory Coast, Liberia, Mauritania, Jordan, Colombia, Panama, Costa Rica, South Korean, South Vietnam, the Philippines and Indonesia. South Korea established six free trade zones, three each in Seoul and Incheon, in 1965. 10 India established the Kandla Free Trade Zone, in Gujarat State, in 1965. 11 Just prior to the 1970s, the first zones appear in communist countries, prefiguring their later use as a market experiment in China. In 1963, Yugoslavia legislated trade zones along the Danube River in Belgrade, Koper and Rijeka, and in 1967 allowed for manufacturing in the zones. 12 And in Manaus, Brazil, a free zone was established in 1967; like most of the zones established in the 1960s, its growth would accelerate throughout the 1970s. 13 It was in the 1970s, in fact, that the free zone became a more thoroughly abstracted and formulaic spatial and economic instrument; despite its historic origins in the European free ports, the zone was now becoming decoupled from the older manifestations and habits of urbanity and from the maritime districts that had once shaped trade. Wherever a plane could land or a truck could maneuver — inland areas, borderlands and backwaters that in earlier eras would never have sponsored the cosmopolitanism associated with global trade — there could now exist new diasporadic centers of global trade. And although private, corporatized interests would be the chief beneficiaries, the zones would also accommodate significant populations of factory workers.

Brassiere manufacturing, Puerto Rico, 1950. [Via Kheel Center for Labor-Management Documentation and Archives, Cornell University]

Maquiladora, Mexico, 2007. [Via Wikipedia]
Top: Brassiere manufacturing, Puerto Rico, 1950. [Via Kheel Center for Labor-Management Documentation and Archives, Cornell University] Bottom: Maquiladora, Mexico, 2007. [Via Wikipedia]

The zone is a legal and economic instrument.

Perhaps the most important factor contributing to the exponential growth of zones in the 1970s was endorsement by the United Nations. 14 The United Nations Industrial Development Organization, or UNIDO, established in 1966, began to research the zone as an economic prescription to incentivize growth in developing countries. When formalized as such, the zone became a global contagion — a widely copied template for what might otherwise have been conceptualized as civic urban space. In the 1970s, UNIDO established a Free Zone Unit that worked with the Shannon Duty-Free Airport Development Co., the Kaohsiung FTZ and the World Bank to instruct developing countries. The unit held seminars around the world, and, in a 1971 report, UNIDO claimed that “… more and more countries, especially the developing countries, are interested in creating an industrial free zone. The existence of such plans have [sic] been announced by more than 30 developing countries, many of them also expressing their desire to obtain [the] technical assistance services of UNIDO.” 15 UNIDO characterized the zone as a temporary phenomenon that would jumpstart economies; when no longer useful in one country, it would be taken up by another on the threshold of the global market. In this way the UN hoped to empower an international “federation of free trade zones,” and it established an organization, the World Economic Processing Zones Association, which first convened representatives of governments before later becoming privatized. 16

As a legal instrument, the free trade zone presides over a laundry list of exemptions which are sometimes mixed with domestic civil laws, sometimes manipulated by business to create opportunistic mixtures of international law, and sometimes adopted fully by the host nation. Zone law varies, but in the most extreme cases, the zone is exempt from civil law and government control; it is not considered part of the territory of the home state and therefore cannot collect tariffs or duties on imported goods. In such instances, the host state usually creates a legal entity that is the zone authority, a parastate proxy with the power to negotiate with businesses and foreign governments. As an early free zone analyst wrote:

The exemptions granted to FTZ operators by these entities are exhaustive enough to strip the most stringent code of civil substance; in fact in most countries the FTZ investors cannot be sued in ordinary domestic courts by individuals. There are special courts to settle disputes with FTZ investors. The FTZ authorities not only override the authority of domestic ministries, courts, revenue offices, central banks, planning authorities, etc., but replace them within the FTZ.

A host country might have strict laws regulating labor, environment, sanitation, health and safety, or human rights. It may be a signatory to global compacts regarding human rights or International Labor Organization compacts regarding the treatment of workers. Yet the zone might have the power to grant exemptions from such laws and compacts, and zone status makes any law difficult to enforce. While UNIDO may have envisioned the zone as a temporary strategy in a changing market environment, the zone authority may issue guarantees that the zone will not be reabsorbed by the host nation. 17

Export Processing Zone, Athi River, Kenya. [Photo by Eduardo Zárate]

Outside the Export Processing Zone, Dhaka, Bangladesh. [Photo by Tony Cassidy]
Top: Export Processing Zone, Athi River, Kenya. [Photo by Eduardo Zárate] Bottom: Outside the Export Processing Zone, Dhaka, Bangladesh. [Photo by Tony Cassidy]

UNIDO promoted the EPZ in the 1971 report referenced above; but less than a decade later, in a 1980 report, the agency was expressing caution about using the zone format as anything more than a short-term catalyst. UNIDO evaluated various factors, from gender roles to the benefits of introducing new technologies into developing countries, and it noted the positive effects of the zone, including enhanced international collaboration. Yet the report argued that the zone often redirected resources that might otherwise be used to improve local infrastructures, business platforms and other potential relationships with foreign interests within the regular state territory. According to the report, “The disadvantages of the EPZ would appear to lie in the continuation of its enclavistic nature. … Perpetuation of the enclave will retain the problems, the social and economic costs, without the obvious off-set of further benefits.” In effect, UNIDO acknowledged that the zone was a losing proposition if it remained distinct from the local economy. But it also realized that the format would likely persist. 18

Essentially concurring with UNIDO, both the Organization for Economic Cooperation and Development and the World Bank have argued that the EPZ is, at best, the second most advantageous way to encourage trade and national prosperity; the best way is simply through investment in the domestic economy. And — especially given the host country’s investment in infrastructure and loss in tax revenues — the zone approach has not always yielded what economists term “spillover effects” or spurred the introduction of new technologies. According to an OECD report: “EPZs are a suboptimal policy from an economic point of view. Improvement of the domestic business environment on [a] national basis through trade and investment liberalization, establishment of good infrastructure, rule of law and administrative simplification remains the optimal policy option to promote investment, employment and growth.” 19 Zones have also been criticized for creating a complex layer of administration sometimes at odds with domestic labor and environmental regulation; and since zone business interests are not responsible for the larger social costs, the zone has been called a potential “health and environment ‘time-bomb.'”

No matter its ultimate effectiveness, the zone has proved durable; most recently China’s adoption of the formula has produced an especially potent and self-perpetuating version. 20 If the Export Processing Zone was Zone 1.0, then China’s Special Economic Zone is Zone 2.0. Established in the early 1980s, the first SEZs — Shenzhen, Xiamen, Shantou, Zhuhai, and the entire province of Hainan — were planned as experiments with market economies. By 1984, China had created 16 more, and since then they have established literally thousands of SEZs. Most of these diverge from the typical EPZ, to the point where China now constitutes its own zone category; and an immense one — by 2006 the International Labor Organization had estimated that of the 66 million workers employed in EPZs worldwide, 40 million were in China. 21

Free Trade Zone, Zhuhai, China. [Photo by Brücke-Osteuropa]

Fiber optics factory, Shenzhen, China. [Photo by Steve Jurveston]

Botanical garden, Tianjin Economic Development Area, Tianjin, China. [Photo by TFL Studio]

Yantian Terminal, Shenzhen, China. [Photo by Bert van Dijk]
Top to bottom: Free Trade Zone, Zhuhai, China. [Photo by Brücke-Osteuropa] Fiber optics factory, Shenzhen, China. [Photo by Steve Jurveston] Botanical garden, Tianjin Economic Development Area, Tianjin, China. [Photo by TFL Studio] Yantian Terminal, Shenzhen, China. [Photo by Bert van Dijk]

The zone is breeding.

As interest in the classic EPZ waned in the ’80s and ’90s, the zone began to breed promiscuously with other enclave formats, or “parks,” merging with offshore financial areas, tourist compounds, knowledge villages, high technology campuses, museums and universities. Rather than functioning as catalyst and dissolving into the general business and industrial climate of its host, the zone has become a persistent yet mutable instrument, transforming as it grew and absorbing more and more of the general economy within its boundaries. As a result many countries — reconsidering the role of their domestic labor force in the typical EPZ —sought to “upgrade” their zones, to move from manufacturing to information technology or financial services. In the past generation, the zone has become a kind of petri dish for the cultivation of a host of spatial products — e.g., calling centers, software production facilities, factory compounds, office parks — that easily migrate around the world and that thrive in legal lacunae and political quarantine, enjoying the insulation and lubrication of zone exemptions. Indeed, the zone as corporate enclave is a primary aggregate unit of the contemporary global city, offering a “clean slate,” a “one-stop” entry into the economy of a foreign country. 22

Many of the early upgraded zones were Science Industrial Parks, based on the research park or campus. Palo Alto’s Stanford Research Park, established in 1951, was the model for scores of SIPs in the U.S., including Research Triangle Park, in North Carolina (which was established in 1959 and became a foreign trade zone in 1983), Cummings Research Park, in Alabama (1962), and the Austin Technology Incubator, in Texas (1989). 23 In 1965 Japan developed Kyushu Silicon Island and Tsukuba Science City three years later, along with 14 other SIPs before the 1990s. Taiwan and South Korea were early adopters in the move to upgrade technologies and to place more emphasis on export rather than on import and processing industries that depended upon cheap labor. In 1980 Taiwan established the Hsinchu Science and Industrial Park, which was followed by Southern Taiwan Science Park and Central Taiwan Science Park.  Soon Singapore, France, the United Kingdom and Germany also established SIPs. 24

In their 1994 Technopoles of the World: The Making of 21st Century Complexes, Manuel Castells and Peter Hall marked a major shift in urban form as former industrial installations were being adapted to the new knowledge economy. 25 The 1990s saw the development in China of many high-tech parks specializing in IT, electronics and pharmaceuticals. In 1991, India established a government agency, Software Technology Parks of India, to broker broadband from the nation’s relatively new satellite fleet for use by IT companies; Bangalore and Hyderabad, among others, quickly developed cyber-city programs. 26 In 2007, the country added Special Economic Zone incentives to the mix. In 1996, based on a McKinsey study, Malaysia launched the Multimedia Super Corridor — a massive development of cyber-cities and cyber-centers located in a 750-square-kilometer zone between the Petronas Towers in Kuala Lumpur and the International Airport; here the incentivized urbanism included high quality infrastructure, tax exemptions for the first 10 years, and the duty-free import of multimedia equipment. 27

Science City, Tsukuba, Japan. [Via Wikipedia]

 Microsoft complex, Hyderabad, India. [Photo by Tony Kent]

Petronas Towers, Kuala Lumpur, Malaysia. [Photo by Wolfgang Sladkowski]
Top: Science City, Tsukuba, Japan. [Via Wikipedia] Middle: Microsoft complex, Hyderabad, India. [Photo by Tony Kent] Bottom: Petronas Towers, Kuala Lumpur, Malaysia. [Photo by Wolfgang Sladkowski]

In 1995 the sociologist and political scientist Xiangming Chen charted three eras in the evolution of the zone. The first era, from the mid-16th century to the 1930s, is dominated by the free port and early free trade zones; the second, from the late 1950s through the 1970s, is characterized by the export processing zones, such as maquiladoras, which focused largely on manufacturing; the third stage, starting in the 1980s, saw the rise of the Special Economic Zones, the Economic and Technological Development Zones, and the Science Industrial Parks. 28 Yet rather than as a progressive evolution, zone development might be described as a proliferation of mutations, which might include programs as diverse as national capitals and tourist resorts. Indeed, operating as it does in a frictionless realm of legal and economic exemptions, the zone, as it merges with other urban formats, perhaps most naturally adopts the scripts — the aura of fantasy — of the vacation resort and theme park. Taken together business travelers, itinerant workers and tourists create temporary populations which, like temporary agreements and shifting identities, are good for business.

The increasing complexity of the zone has in fact confused economists who’ve attempted to classify the form as it has spread in waves around the world. Beyond the Export Processing Zone, which has remained the most popular designation for this repeatable formula, a 1998 World Bank report tracked 19 different terms for zone, including free trade zone, foreign trade zone, industrial free zone, free zone, maquiladora, export free zone, duty free export processing zone, special economic zone, tax free zone, tax free trade zone, investment promotion zone, free economic zone, free export zone, free export processing zone, privileged export zone and industrial export processing zone. 29 By the first decade of the 21st century, there were at least 66 terms for the zone in circulation. 30

In essence zone now describes a scatter of incentivized urban forms, and the fence that once surrounded it has both broadened and multiplied. Globe-trotting analysts chase after it, even as the zone is mutating on the ground and oscillating between visibility and invisibility, identity and anonymity. Many analysts attempt to quantify benefits in terms of employment, technology transfer, investments, etc. — again, the spillover effect. But although the zone has proven to be, in the terms of the OECD report, a “sub-optimal” economic catalyst, its cheap labor and legal exemptions have become global business standards.

The scores of zone variants constitute the volatile mixers for a potent cocktail of urban aspiration. Legal parameters may replace the physical fence, or the fence may be metaphorically thickened as the sweatshops and dormitories of labor exploitation morph into gated compounds or precincts in the zone city. Industry boosters extol — and exploit — the free-market advantage. Yet even as the zone has traded conventional state bureaucracy for potentially more complex layers of parastate governance, it has itself become an instrument of market manipulation and a perverse tool of economic liberalism.

Shenzhen, China. [Photo by Richard Yuan]
Shenzhen, China. [Photo by Richard Yuan]

The zone is a city.

In its most recent incarnations, the zone has swallowed the whole of the city, and now even calls itself a “city.” The term is a source of pride, an enthusiastic validation of the zone’s effort to evolve beyond its early identity as a remote locale for warehousing and transshipment. Some Asian and African nations have used zones to underscore their entry into global markets or their new identities as independent post-colonial contractors of outsourcing and offshoring. In some places, the “city” refers to the zone enclave, as is the case in countless “cyber cities,” “technocities,” or “logistics cities.” The Science Industrial Parks of the IT industry seem especially to inspire the city label, e.g., HITEC City, which refers to the Hyderabad Information Technology Consultancy City, in India, or Ebene Cybercity, on the island of Mauritius. “City” can also be an actual metropolis, a recognizable city-state or urban aggregation of zones; if the zone banishes many of the circumstantial frictions of urbanity, it nonetheless welcomes a host of residential, business and cultural programs.

Shenzhen, in Guangdong Province, was selected in 1980 to be the first of China’s Special Economic Zones, and as such one of the cities where the new economic freedoms were incubated in the ’80s. Today it has outgrown this early identity as quarantined capitalist enclave; it has ballooned into a mega-city, what the business strategist and McKinsey partner Kenichi Ohmae has described as a neoliberal region-state. With a phenomenal rate of growth (ranging from 15 to 28 percent yearly), Shenzhen has a resident population of over 8 million and a transient population of around 14 million. The SEZ comprises 4 of the 7 districts of the city and approximately 396 square kilometers (approx. 150 square miles); there are plans to expand the zone to include other districts for a total of 2,000 square kilometers (approx. 700 square miles). Expansion, it is hoped, will ease real estate prices in downtown Shenzhen, while also extending to more citizens the better health care and education now available in the zone. 31

Perhaps ironically, or inevitably, Shenzhen SEZ, after a quarter century of growth, has begun to generate its own version of civic activism. Despite official repression, the rising middle class has acted to protect its new property interests, e.g., organizing boycotts to protest real estate prices, and agitating to block the construction of a new highway. Some citizens have formed a research group, Interhoo, which monitors development activities and fields candidates for municipal or district office. And despite the seemingly inexhaustible supply of cheap labor, there are also thousands of labor strikes every year, along with petitions for better wages. Still, the All China Federation of Trade Unions, which includes the Guangdong Federation of Trade Unions, permits only trade union activity organized from within the state hierarchy; efforts to organize migrant laborers, who often work in abusive and dangerous situations, are usually squelched by the state. And yet because of its sheer size, and the growing distance between downtown and the factory districts, Shenzhen is characterized today by a complex and restless urbanity; despite state repression, the city is out of control in ways both productive and dangerous.

Dubai, United Arab Emirates. [Photo by Tom Oliver]
Dubai, United Arab Emirates. [Photo by Tom Oliver]

Perhaps even more than China, the United Arab Emirates has used the zone to distinct advantage — to control foreign influence, to elevate the status of privileged nationals, and to leverage the region’s oil and gas resources to create diversified industries. Much like Shenzhen, Dubai is the city as zone and the zone as city — it is an offshore financial center and an aggregate of zones, most of which are dubbed “city.” Dubai’s first free trade zone, the Jebel Ali Free Zone, was established in 1985 and is now 48 square kilometers. Since then, Dubai has hosted zones for almost every imaginable program; there is Dubai Internet City, Dubai Health Care City, Dubai Maritime City, Dubai Silicon Oasis, Dubai Knowledge Village, Dubai Techno Park, Dubai Media City, Dubai Outsourcing Zone, Dubai International Humanitarian City, Dubai Industrial City, Dubai Textile Village, Dubai Auto Parts City. Each offers a different suite of incentives that might include visas, streamlined customs processing, cheap labor from South Asia and Africa, and foreign ownership of property, including the right to own real estate in such tony projects as the Palm islands and other projects developed by the powerful Nakheel Properties. Adding to the complexit is the fact that each zone might have its own legal status; for instance, Dubai Media City, the headquarters for major news outlets, allows freedoms of speech not technically permitted elsewhere in Dubai.

In King Abdullah Economic City, on the Red Sea, near Jedda, the zone is again an aggregate component of a full-blown city. Launched in 2006 by the Saudi government and the Dubai-based developer Emaar, the city, when complete, will encompass 168 square kilometers (about the size of Brussels). The Saudis also plan to build Knowledge Economic City, in Medina, Jazan Economic City, in Jazan, and Prince Abdulaziz bin Mousaed Economic city, in Hail, among others. In King Abdullah Economic City, the first area to be developed will be an industrial zone covering one-third of the city and housing workers’ dormitories and a mosque and prayer rooms. It is not clear whether workers will have full access to the rest of the city, especially to its expensive and securitized areas. Right now plans also call for a manufacturing zone, “Plastics Valley,” which will exploit auxiliary petrochemical resources; an international container seaport with logistics, warehousing and transshipment facilities; and, some distance away from these areas, various “city districts” with residential, educational, tourist, health care and cultural areas.

The renderings for one district, Bay La Sun, show a mall, business park, mosque, hotel and tall buildings, all arranged around artificial canals connected by a highly engineered bridge. The advertising literature for King Abdullah Economic City promotes a “high-class” and “prosperous” lifestyle, with residences ranging from $100,000 to $400,000. KAED will be on the Mecca-Medina rail line, part of a high-speed rail network that Saudi Arabia is planning. The city will allow for foreign ownership and offer exemptions from import duties; residents will pay no personal income tax and corporate taxes will be minimal. In the architects’ renderings, including fly-throughs, KAEC appears as a shimmering golden city with both skyscrapers and traditional Islamic buildings that together are intended to constitute a monument to the state and its “wise leadership.”

King Abdullah Economic City, Saudi Arabia. [Image by Emaar Development]
King Abdullah Economic City, Saudi Arabia. [Image by Emaar Development]

The zone is in the crosshairs of extrastatecraft.

Today we might understand the zone to be the embassy or parliament of the elite parastate corporation, the site of multinational and offshore headquartering and the spatial instrument for externalizing obstacles to profit. Even a corporation like Halliburton, which has received lucrative contracts from the U.S. government paid for by tax-payer dollars, was able easily to move its headquarters from Houston to Dubai, where it has not only benefitted from business-friendly tax laws but also positioned itself more squarely amid its Middle Eastern petro-interests. Here, real estate operators like Emaar Properties provide the spatial environments and amenities to which multinational business “families” have grown accustomed. Enjoying quasi-diplomatic immunities, corporations might help their various zone hosts to forge relationships with the International Monetary Fund and the World Bank, and they might provide expertise and support for developing transportation and communication infrastructure.

Construction companies and infrastructure specialists —including Bouygues Telecom, Saudi Binladin Group, Mitsubishi, Kawasaki and Siemens, among others — deliver technologies for high-speed rail, high-rise engineering and automated transit. Conglomerates such as PSA Singapore, P&O Trans Australia, Hutchison Port Holdings and European Container Terminal, which provide transshipment and warehousing technologies, function as modern counterparts of the British and Dutch East India Companies of the early modern era. Technology parks around the world grow their own satellite and cable networks with their own headquarters at the interstices of the network. In short, ever-proliferating species of global corporations stick together in the same extrastate legal habitat that can be extended to anywhere in the world.

Like the American colonies governed and unified by Spain’s Laws of the Indies, and maybe even like the utopian experiments of protestant pilgrims in the New World, the zone might also be understood as a peculiar form of intentional community. Although structured to avoid the messy unpredictability of the traditional city, the zone is nevertheless generating its own particular urbanism. Indeed, after multiple cycles of breeding, it is developing some unlikely — we might say recessive — traits. Witness the Dubai-based International Humanitarian City, which is an outpost of relief agencies and NGOs and thus exists to support some of the chief critics of zone politics and abuses. Masdar City, located in Abu Dhabi and established by the Abu Dhabi Future Energy Company, is a free zone for green energy enterprises. Master planned by Foster and Partners, the plan, not unlike the ideal city of antiquity, is a square grid, with a sectional form designed to maximize shading, collect solar energy and provide an underground zone for personal-rapid-transit electric vehicles. One of the newest species to join the zone habitat are universities. Qatar Education City, for instance, located just outside Doha, uses the campus park/zone model to host the satellite campuses of eight universities, six from the U.S. and one each from the U.K. and France. This kind of public-private sponsorship — Education City is funded by a foundation that is in turn supported by the emirate — is making the Western university a kind of zone incubator of intelligence and manpower.

Masdar City, Abu Dhabi, United Arab Emirates.
Masdar City, Abu Dhabi, United Arab Emirates. [Photo by RIM Creation]

Yet while the organizational and political language that promotes zone development relies heavily on terms like openness, relaxation, and freedom, the reality that follows is often the opposite. The zone might offer what appears to be a cleaner, smarter and more beautiful urbanism than that of its native context. Yet the promise of openness often turns out to be a masquerade. Zones cheat, just as maritime city-states cheated for centuries; yet unlike the old city-states, the zone city is not yet the scene of intensified urbanity, but rather the setting for secrets, hyper-control and segregation. And as the contemporary entrêpot of the planet’s resources, the zone, despite efforts to be apolitical, is now in the crosshairs of pirates, terrorists and traffickers. To the degree such efforts are coordinated, the zone will likely attract more and more global policing, security and intelligence.

Paradoxically, the zone is at once the mascot and contradiction of the basic tenets of “free market” liberalism. The United Nations and global business interests promoted the zone as a market mechanism — and then lobbied for its adoption as government policy. In a sense the free zone is itself a form of big government par excellence, constituting a significant effort to thread together existing networks of global contractual relations in the absence of any robust international law. Global consultancies, multinational corporations, real estate interests, intergovernmental organizations and state governments — all have contributed to fueling an engine that appears unstoppable. The proliferation of the zone as a worldwide urban-infrastructural format is deriving less from any financial return or economic wisdom than from the very fact of its self-perpetuating proliferation.

Even if the newest developments, such as the sparkling cities of the UAE, reinforce the updating to Zone 2.0, the zone, with its emphasis on the enclave, nonetheless remains a relatively dumb form of urban software. In the future the wisest zone entrepreneurs will question this central feature and ask: Why enclave? What types of incentivized urbanism will actually benefit from physically segregated infrastructure — from being separate and even distant from the dense and dynamic central spaces of existing cities? Given that the zone is now generating its own urban programs — aspiring to be a city — what economic and technical benefits can result from constructing what is in effect a double or shadow of the city? In this strange and opportunistic isomorphism, zone entrepreneurs might come to see not freedom but a kind of entrapment, as the zone continues to persist long past its useful life. Ultimately what might prove more important to entrepreneurs — and activists — is the zone’s presence as a multiplier. The global zone exists now as a transnational network, and as it continues its mutation from warehouse compound to world city, it might be a carrier of richer, alternative forms of urbanism.

Editors' Note

This essay has been expanded and incorporated into Keller Easterling’s Extrastatecraft: The Power of Infrastructure Space, which has just been published by Verso.

  1. Guangwen Meng, The Theory and Practice of Free Economic Zones: A Case Study of Tianjin, People’s Republic of China (Ruprecht-Karls University of Heidelberg, 2003); G. W. Meng, “Evolutionary Model of Free Economic Zones-Different Generations and Structural Features,” Chinese Geographical Science 15, no. 2 (2005); R. J. McCalla, “The Geographical Spread of Free Zones Associated with Ports,” Geoforum 21, no. 1 (1990).
  2. Marseille, in Southern France, a free trading port established in 1228, and Leghorn, in Genoa, established in 1547, garnered considerable power in their heyday in the 16th and 17th centuries.
  3. Helen Zimmern, The Hansa Towns, The Story of the Nations, 3rd ed., (London: T. Fisher Unwin, 1889). Fiercely independent, the Hansa traders created a rather monastic society, living and dining together in their trading halls and factories where, in foreign cities, they were also sometimes confined.
  4. See Guangwen Meng, The Theory and Practice of Free Economic Zones.
  5. G. W. Meng, “Evolutionary Model of Free Economic Zones-Different Generations and Structural Features,” 105, 27. By 1900 there were, by some counts, 11 free ports in the world. In the first half of the 20th century, 18 more free ports were created in Europe, primarily in Sweden and Switzerland; R.J. McCalla: “The Geographical Spread of Free Zones Associated with Ports,” 123; see also Guangwen Meng, The Theory and Practice of Free Economic Zones. Of the eight created in Latin America, five were puertos libres created after Mexico established free port law in 1924. See Dara Orenstein, “Foreign Trade Zones and the Cultural Logic of Frictionless Production,” Radical History Review (2010). Two in Uruguay were primarily intended to attract trade from other South American countries. Two free zones were established in Africa and one in Asia. R.J. McCalla: “The Geographical Spread of Free Zones Associated with Ports,” 127. When Hamburg joined the newly unified German Empire in 1871, the city refused to become a member of the German Customs Union, for fear of losing its trading freedoms. Leveraging its willingness to enter the empire in 1888, Hamburg was allowed to establish a fenced-off area that would remain outside national control. Within this area they were granted increased freedom for sorting, manipulating and manufacturing warehoused goods before re-export.
  6. Dara Orenstein, “Foreign Trade Zones and the Cultural Logic of Frictionless Production,” 7.
  7. R.J. McCalla, “The Geographical Spread of Free Zones Associated with Ports,” 130.
  8. R.J. McCalla, 128, 129.
  9. Richard L. Bolin, “What Puerto Rico Faced in Being First to Create Epzs in 1947… and Its Huge Success” (paper presented at the Award ceremony during conference of the Latin American Free Trade Zones Committee, San Juan, Puerto Rico, 2004).
  10. D. L. U. Jayawardena, “Free-Trade Zones,” Journal of World Trade, vol. 17, no. 5 (1983).
  11. During this same period, the U.K., Tanzania and Sri Lanka also set up business, manufacturing or enterprise zones.
  12. R.J. McCalla, “The Geographical Spread of Free Zones Associated with Ports,” 129-130.
  13. Walter H. Diamond and Dorothy B. Diamond, Tax-Free Trade Zones of the World (New York: Matthew Bender, 1986).
  14. R.J. McCalla, “The Geographical Spread of Free Zones Associated with Ports,” 131-132. Accounting for all the free zones in the world is fraught with difficulty; some analysts only count distinct types, such as the EPZ, even though the form has been hybridizing and developing new types. These differ slightly because of differences in classification, but the Organization for Economic Cooperation and Development and others often repeat International Labor Organization figures, and these continue to appear in other sources as well. Globally, in 1975, there were 25 countries and a global total of 79 EPZs employing 8 million. In 1986, those numbers nearly doubled to 47 countries and 176 EPZs employing 1.9 million. By 1997, 93 countries and over 845 EPZs employed 4.5 million. In 2002, 116 countries hosted 3,000 zones employing 13 million. In 2006, 130 countries hosted 3,500 zones employing 26 million, as the zone continued to migrate from Asia and the Caribbean to Africa. In the United States, the number of zones increased from fewer than 10 to 54 by 1980 and 118 by 1986. See M. Engman, O. Onodera and E. Pinali, “Export Processing Zones: Past and Future Role in Trade and Development,” in OECD Trade Policy Working Papers (OECD, 2007); Takayoshi Kusago, Zafiris Tzannatos, and World Bank, Human Development Network, Social Protection Team, Export Processing Zones : A Review in Need of Update (Washington, DC: Social Protection Group, Human Development Network, World Bank, 1998); Jean-Pierre Singa Boyenge, “ILO Database on Export Processing Zones,” (Geneva: International Labour Office, 2007).
  15. Tsuchiya Takeo, “Introduction,” AMPO: Japan-Asia Quarterly Review, Special issue on Free Trade Zones and Industrialization of Asia (1977), 4. While Takeo refers to WEPZA, the World Economic Processing Zone Association (WEPZA) claims these same origins with 1978 as an inaugural year. In 1980, although there were other free zones of various types in both developing and developed countries, UNIDO listed the following developing countries as operating export processing zones: Liberia, Malta, Mauritius, Senegal and Tunisia, in Africa; India, Malaysia, Philippines, South Korea, Singapore, Sri Lanka and Taiwan, in Asia; Barbados, Belize, Brazil, Chile, Colombia, Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Jamaica, Mexico, Nicaragua, and Puerto Rico, in Latin America; Egypt, Jordan and Syria, in the Middle East; and Western Samoa, in the South Pacific. See “Export Processing Zones in Developing Countries,” in UNIDO Working Papers on Structural Changes, ed. International Centre for Industrial Studies Global and Conceptual Studies Section (UNIDO, 1980).
  16. Tsuchiya Takeo, “Introduction,” AMPO: Japan-Asia Quarterly Review, Special issue on Free Trade Zones and Industrialization of Asia (1977). Established as an organization of governments, WEPZA privatized in 1985 and became an organization of export processing zones managed as an independent non-profit research organization. The director emeritus, Richard Bolin, had helped to prepare a 1964 study for the Mexican government that resulted in the maquiladora program. As WEPZA describes itself, “the Institute is also active in educating governments, international organizations, and regional and global trade organizations on the efficiency of EPZs in attracting Foreign Direct Investment to poor countries and the importance of their economic freedoms in many aspects of national and global development.” WEPZA is perhaps characteristic of the so-called neo-liberal shift in global organizations from intergovernmental organizations with member nations to non-governmental organizations with membership from private enterprises.
  17. D. L. U. Jayawardena, “Free-Trade Zones,” Journal of World Trade, vol. 17, no. 5 (1983), 428. In some zone formations, the local government, in a public-private partnership, provides the infrastructure to inaugurate the zone and helps to manage the zone in exchange for a majority share. In theory, the zone authority can also work with a state ministry for labor or economic affairs to implement a series of regulations. In socialist or communist countries, like China, the larger state has more control than in countries with a long-standing market orientation. See Xiangming Chen, “The Evolution of Free Economic Zones and the Recent Development of Cross-National Growth Zones,” International Journal of Urban and Regional Research, vol. 19, no. 04 (1995).
  18. “Export Processing Zones in Developing Countries,” in UNIDO Working Papers on Structural Changes, (UNIDO, 1980), 40-41.
  19. M. Engman, O. Onodera, and E. Pinali, “Export Processing Zones: Past and Future Role in Trade and Development,” in OECD Trade Policy Working Papers (OECD, 2007), 6, 25. See also Takayoshi Kusago, Zafiris Tzannatos and World Bank, Human Development Network, Social Protection Team, Export Processing Zones: A Review in Need of Update.
  20. G. Gereffi, “Development Models and Industrial Upgrading in China and Mexico,” European Sociological Review, vol. 25, no. 1 (2009).
  21. Engman, Onodera and Pinali, “Export Processing Zones: Past and Future Role in Trade and Development,” 8.
  22. See Takayoshi Kusago, Zafiris Tzannatos, and World Bank, Human Development Network, Social Protection Team, Export Processing Zones : A Review in Need of Update.
  23. See Diamond and Diamond, Tax-Free Trade Zones of the World. In 1983, Research Triangle Park applied for Foreign Trade Zone status, and it now has headquarters and warehouses as well as sites of over 800 acres that qualify as tax-free zones; its population is now almost 3 million. See Xiangming Chen, “The Evolution of Free Economic Zones and the Recent Development of Cross-National Growth Zones,” 605.
  24. See Guangwen Meng, The Theory and Practice of Free Economic Zones.
  25. Manuel Castells and Peter Hall, Technopoles of the World: The Making of 21st Century Industrial Complexes (London: Routledge, 1994).
  26. Keller Easterling, Enduring Innocence : Global Architecture and Its Political Masquerades (Cambridge, Mass.: MIT Press, 2005).
  27. While the zone absorbed the installations of new knowledge economies, it also became a new trading entity with new transportation ambitions as well as an automated trans-shipment landscape. The Schiphol Group, based at Amsterdam’s Schiphol Airport, had ambitions to manage and build 24-hour “airport cities” worldwide. More than a duty-free installation like Shannon Airport, the Schiphol group proposed spatial products or spatial technologies that would match layover times with shopping times and tonnage of freight to create an economically optimized urban apparatus. Digital capital would turn goods into information via tight supply chains and materials handling. In 1995, in The End of the Nation State: The Rise of Regional Economies, former McKinseyite Kenichi Ohmae sketched specifications for the new region state as a conurbation of 5 to 20 million people with an international airport and a harbor capable of handling international freight and servicing a new multinational corporation, redesigned by the just-in-time, lean management techniques that Japan was then teaching the world. Reflecting zone logics, region-states would be freed from state governance, with their boundaries “drawn by the deft but invisible hand of the global market for goods and services.” See Kenichi Ohmae, “The Rise of the Region State,” in Foreign Affairs, vol. 72, no.2, 1993; reprinted in Globalization and the Challenges of a New Century (Bloomington: Indiana University Press, 2000), 93, 95.
  28. Chen also drew attention to the development of cross-border conurbations of zone formations on, for instance, the Tumen River between Russia and Korea as well as cross-national growth zones in the South China Sea. Chen settled on the term “Free Economic Zone” for all these forms and speculated on the ensuing phases of growth. Building on this analysis, Guangwen Meng identified seven generations of free-zone development that largely conformed to those described by Chen: A first generation associated with trade evolves to a second that includes manufacturing; the third generation includes service and the fourth includes science. Meng designates the fifth generation as inclusive of many business and industry functions. The sixth and seventh he designates as cross-border and cross-national types, noting (as does Chen) that these conurbations are often now operating independently from the local state jurisdiction but in multiple extrastate networks. See Guangwen Meng, “Evolutionary Model of Free Economic Zones-Different Generations and Structural Features,” and Xiangming Chen, “The Evolution of Free Economic Zones and the Recent Development of Cross-National Growth Zones,” International Journal of Urban and Regional Research, vol. 19, no. 4 (December 1995).
  29. See Kusago, Tzannatos, and World Bank, Human Development Network, Social Protection Team, Export Processing Zone: A Review in Need of Update.
  30. G. W. Meng, “Evolutionary Model of Free Economic Zones-Different Generations and Structural Features,” 103. Industry organizations and private investment consultants also maintain databases about zones. The World Export Processing Zone Association has, like the ILO and the OECD, kept databases tracking zone growth. WEPZA categorizes the various types as “wide area” (those that have a residential population and act as new cities, such as China’s Special Economic Zones); “small area” (zones smaller than 1,000 hectares and surrounded by a fence); “industry specific” (zones related to a particular industry, e.g., “banking, jewelry, oil and gas, electronics, textiles, tourism, etc.”); and “performance specific” (zones that conform to established criteria such as “degree of exports, level of technology, size of investment etc.”). A maquiladora or research park would be an example of this last type. None of the modes of classification coincide, and most generate significant category mistakes one to the other. Meng, for instance, indentifies a number of cross-border zones in an area around the confluence of national borders between the Netherlands, Brussels and Germany. Yet, according to the WEPZA, there are no EPZs in Brussels. The WEPZA has a designation for industry specific zones that would include offshore banking facilities; and yet, although Dubai is an offshore facility for the whole of its territory, the UAE is listed as not having any industry specific zones. See Meng, The Theory and Practice of Free Economic Zones.
  31. The entire city of Shenzhen offers free zone privileges, although there are also distinct EPZs within the SEZ, such as the Shekou Industrial Zone, which allow businesses to negotiate with a zone authority rather than the Guangdong Provincial Administration that controls Shenzhen SEZ. The SEZ collects a variety of taxes and also provides a number of tax reductions or tax holidays and exemptions, but the biggest attractions for business are low rent and cheap labor. Diamond and Diamond, Tax-Free Trade Zones of the World; D.L.U. Jayawardena, “Free-Trade Zones,” 438.
Keller Easterling, “Zone: The Spatial Softwares of Extrastatecraft,” Places Journal, June 2012. Accessed 10 Jun 2023.

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