County commissioners on Nov. 30 strengthened the county’s international import-export links by approving a request from the Port of Corpus Christi allowing it to extend its foreign trade zone (FTZ) to the county.
A foreign trade zone is the U.S. equivalent to a free trade zone — area near a port of entry considered to be outside the United States or outside U.S. Customs territory — in which a company can import foreign goods duty free until they enter the country.
The extensions are called FTZ service areas.
The Port also is hoping to extend its FTZ to include Jim Wells, Kleberg and possibly Aransas counties.
Sonya Lopez-Sosa, the Port’s FTZ manager, told commissioners the extension is cost-free.
By extending its FTZ, the Port hopes to attract more companies with foreign customers to operate in South Texas because more sites and acreage then is available.
Some of the added real estate are prime locations, such as Chase Field.
The FTZ board, based in Washington, began authorizing the expansion of existing FTZ sites nationwide in 2009 through its alternate site framework (ASF) program.
Of the 262 FTZ sites in the country, Lopez-Sosa explains, 62 percent have taken advantage of the ASF program to extend their sites.
A highly active ASF site is adjacent to DFW airport in the Dallas-Fort Worth Metroplex.
The Port is authorized to extend its territory as long as the area is within 60 miles or 90 minutes’ driving time away.
Without going into specifics, Lopez-Sosa said she was in increasingly frequent contact with a group of Chinese businessmen who were interested in the South Texas FTZ site.
“I’ve had four visits from them in six months,” she said, “which is encouraging.”
Earlier this year, she had conversations with Joe Montez, executive director of the Bee Development Authority with headquarters at Chase Field.
County commissioners approved the request unanimously.
Benefits to the county include increased business, companies enjoy duty deferral and tax exemptions.
“We approved it. Now we’re waiting for something to happen,” County Judge David Silva says.
Whether businesses choose to locate in Bee County is a chicken-egg quandary. “I don’t think we’re going to see a plethora of business out of this,” Silva says. “But nothing can happen with an FTZ if the county isn’t part of it.”
Silva explains that a long-term vision is necessary, citing the construction of a wider and deeper Panama Canal, which would allow container vessels that normally dock at the highly congested Port of Los Angeles to use the Port of Corpus Christi.
That, combined with a new Mexican railroad line expected to extend from Panama to Nuevo Laredo, would mean increased truck traffic on both I-35 and on the long-proposed I-69. Both would mean more business for Beeville.
Seventeen companies, ranging from Halliburton to at least four refining companies, take advantage of the Port’s FTZ.
“Corpus Christi was the first to establish a foreign trade zone that was based on the refinery business,” Lopez-Sosa says.
Prior zones dealt with hardware, she explains, so many pieces of pipe, for instance. “But the refinery product flows through a pipe.”
The Port expects to file its extension requests in a couple of months and expects the extensions to be in place by March.
Bill Clough is a reporter at the Bee-Picayune and can be reached at 358-2550, ext. 122, or at beepic@mySouTex.com.