THE ROLE OF INDUSTRIAL ZONES IN ATTRACTING FOREIGN DIRECT INVESTMENT: EVIDENCE FROM DEVELOPING ECONOMIES

This study examines the role of industrial zones in attracting foreign direct investment (FDI) in developing economies. Industrial zones are considered one of the most effective policy instruments for improving the investment climate, reducing institutional barriers, and creating favorable conditions for foreign investors. The paper analyzes how factors such as infrastructure development, tax incentives, regulatory simplification, and strategic location of industrial zones influence foreign investors’ decisions. Special attention is given to the experience of developing countries, where industrial zones have contributed to industrialization, employment generation, and integration into global value chains. In my personal view, the effectiveness of industrial zones in attracting foreign direct investment largely depends not only on fiscal incentives, but also on the quality of governance, long-term policy stability, and the level of integration between industrial zones and the domestic economy. The findings suggest that well-managed industrial zones can serve as a sustainable driver of foreign direct investment and economic growth in developing economies.