obviously highlights that Africa remains a very small player in the EPZ market; however, it is broadly in line with the region’s share of global trade and investment.

Virtually no detailed data exist that would allow for a broad analysis of Africa’s performance in EPZs – in terms of investments, exports, and employment – relative to other regions. The only (limited) data available from the ILO’s database (Boyenge, 2007) provides an indication on employment levels in zones. This shows that, as of 2006, zones in Africa and the Indian Ocean (Mauritius, Madagascar, and Seychelles) employed over 1 million workers. This is equivalent to 4% of worldwide zone employment (excluding China; 1.6% including China). However, half of the total employment listed in the ILO database is from one country (South Africa).

Anecdotal evidence suggests that success in African zones (even defined narrowly in terms of scope and time) has been limited to a few countries such as in Mauritius, Kenya, and Madagascar. In many other countries in the region – including Nigeria, Senegal, Malawi, Namibia, and Mali – zones appear to be struggling for a variety of reasons, including poor locational choices, lack of effective strategic planning and management, and problems of national policy instability and weak governance (Watson, 2001). Even where programs have been successful in attracting investment, creating employment, and generating exports, there are concerns over the quality of investment and employment as well as its sustainability. Indeed, the recent experience of Madagascar may highlight the fragility of the economic zones models implemented in Africa to date.

# **3. Defining and measuring “success” in economic zones**

Economic zones are normally established to act as a catalyst for trade, investment, and wider economic growth. Most often they aim to improve competitiveness so as to facilitate the economic transformation of their host countries in a way that is faster or more effective than would be the case without them. In different countries and at different times, however, the more specific objectives may vary. According to FIAS’s 2008 report, zones are created with four specific – although by no means exclusive – policy goals:

1. _To attract foreign direct investment_ . Most new EPZ programs, particularly in the Middle East, are designed to attract foreign investment (FIAS, 2008, p. 12).

2. _To serve as “pressure valves” to alleviate large‐scale unemployment_ . The EPZ programs of Tunisia and the Dominican Republic are frequently cited as examples of programs which have remained enclaves and not catalyzed dramatic structural economic change, but have nevertheless remained robust, job‐creating programs.

3. _In support of a wider economic reform strategy_ . In this view, EPZs are a simple tool permitting a country to develop and diversify exports. Zones are a way of reducing anti‐export bias while keeping protective barriers intact. The EPZs of Taiwan (China), Mauritius, and the Republic of Korea follow this pattern.

4. _As experimental laboratories for the application of new policies and approaches_ . China’s EPZs are classic examples of this category. Financial, legal, labor, and even pricing policies were introduced and tested first within the EPZs before being extended to the rest of the economy.

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