Iran Re-Energizes The Kish Island Free Trade Zone
Iran has completed a 127-kilometer gas pipeline from its Hormozgan Province to Kish Island, turning connectivity this Monday (August 22).
Iran’s Oil Minister Javad Owji, said that the laying of a gas pipeline to Kish Island will allow savings of about US$400 million in consumption of oil products and liquefied petroleum gas (LPG) on the island.
“A total of $350 million has been spent on the laying of the mentioned gas pipeline, and 28 million cubic meters of gas can be transported daily via the pipeline. This means the funds spent will be returned within a maximum of one year,” he said.
Kish Island is a 91.5 square-kilometre resort off the southern coast of Bandar Lengeh County, in Hormozgān Province in the Persian Gulf. Owing to its free trade zone status, the island is touted as a consumer’s paradise, with numerous malls, shopping centres, tourist attractions, and resort hotels, and it is possible to visit without having to have an Iranian visa with stays of up to 14 days permitted.
Kish has become one of the most-visited vacation destinations in the Middle East, after Dubai and Sharm el-Sheikh.
The Iranian government has embarked on an aggressive promotional and developmental campaign to position Kish as a rival to Dubai and to Doha. The campaign has also included, apart from tourism, massive construction projects and programs designed to attract foreign investment and trade.
Within the Kish Island Free Zone, the standard laws of the Islamic Republic of Iran are far more relaxed than on the mainland. This has resulted in significant increases in mostly domestic tourism, as well as international trade on the island. Kish is home to an International Oil Trading Bourse and has storage and shipping facilities on the island to permit energy trading.
Kish free zone’s success lies in its unique strategic situation in the Oman Sea and because of its close distance to Dubai and being on the transit line from/to the countries on Persian Gulf coast. It encompasses a strategic position for foreign trading, re-exporting, importing high quality and well-known brands and promoting them to Iranian and foreign visitors and re-exporters.
15% of all imports to Iran are now through Kish, while foreign investment into the free trade zone has reached US$590 million, aimed at manufacturers reaching out to other markets in the Middle East, East Africa, and South Asia.