TEHRAN- Reza Masrour, the secretary of Iran’s Supreme Council of Free Trade and Special Economic Zones, announced the finalization of the transformation document for free zones and the drafting of the digital economy document for free zones within the government, stating that the implementation of these documents will transform the future roadmap of the free zones.

Elaborating on the details of the transformation document, the official stated: "This document has been formulated based on an examination of the systemic issues and an assessment of these zones against global experiences. Each free zone has been specialized according to its real advantages. For example, Kish is defined as a financial and digital economy hub, Aras is focused on logistics and transit, and other zones have been defined based on their capacities."

According to Reza Masrour, the free zones are required to develop and submit their five-year roadmaps based on this document.

Pointing out that one of the axes of the seventh generation of free zones globally is the digital economy, he added: "The digital economy document for free zones will also be finalized within the next two weeks. This document includes the legal requirements for transforming free zones into the country's digital economy hubs."

The official further stated that a significant part of development challenges are rooted in existing laws, emphasized: "The amendment to the Free Zones Law has been reviewed in the High Council and approved in a specialized workshop, and it has now been submitted to the relevant ministry as a bill to undergo legal procedures so that it can be sent to the parliament after government approval."

Regarding the progress of completing unfinished projects, Masrour said: "Dozens of infrastructure projects are underway in the free zones, ranging from small-scale projects to projects worth tens of billions of tomans. The main challenge for these projects is financing."

He added: "With the notification of the guideline for partnership with the private sector and the use of modern financing methods, the pace of project completion has accelerated. Monthly meetings are also being held to monitor and remove construction obstacles."

The Free Trade and Special Economic Zones High Council has recently announced that the process of converting customs offices located in free zones into specialized customs for importing specific goods will be accelerated with the aim of facilitating trade processes and providing better services to importers.

According to the announcement by the Supreme Council, the proposal from the Secretariat of the Supreme Council of Free Trade and Special Economic Zones regarding the establishment of specialized customs has been submitted to the Islamic Republic of Iran Customs Administration (IRICA), and necessary cooperation and coordination are underway by the customs authorities. This measure aims to effectively utilize the four-billion-dollar import quota to the mainland through free zones and accurately identify entry points with trade advantages.

It should be noted that the establishment and development of specialized customs offices will not only accelerate trade processes but also play a significant role in enhancing safety, creating sustainable employment, and strengthening the local economy in free zones.

On November 20, Economy Minister Seyed Ali Madanizadeh said that Iran plans to create an independent banking system dedicated to its free trade zones as part of a broader effort to overhaul the country’s economic governance, adding that free zones will serve as the launchpad for structural reform.

Speaking at a meeting with business leaders in the Aras Free Zone, Madanizadeh said the government aims to expand economic freedoms, lift restrictions and accelerate decentralization in the country’s most commercially active regions.

He said the administration has begun implementing a new transformation plan for free zones, built around decentralization and specialization of activities in each zone. The pilot phase will begin in East Azarbaijan Province, centered on the Aras Free Zone.

Madanizadeh said the government is moving to establish an independent bank dedicated to the financial needs of free zones. Aras will also be assigned a lead commercial bank to coordinate services, and steps are being taken to establish an independent chamber of commerce for the zone.

He said the government has adopted a supportive stance toward investors and producers operating in free zones, and confirmed that all ministerial directives limiting trade activity in these areas will be revoked. A new Free Zone Development Secretariat has been launched inside the Ministry of Economy, with Aras designated as its pilot site.

The minister also announced new tax policies aimed at relieving pressure on businesses, including maximum instalment options for tax payments. A unified “free-zone citizen card” will be issued for all free zone residents and operators, he added.

Other measures under review include the removal of price-setting rules in free zones. Madanizadeh said a number of restrictive regulations in the past had originated from within the ministry itself, and the government was now working to eliminate them. He urged private-sector actors to pursue their demands directly, and said a new communication channel would be established to allow businesspeople to engage with the minister’s office.

He said the government is committed to mobilizing all available tools to expand investment across the free zones, calling on companies to “step forward” as reforms advance.

As the senior officials said at a national investment forum in early September, Iran’s government is moving to overhaul its free trade zones by focusing on privatization, exports, and greater private-sector participation.

The National Conference on the Capabilities and Investment Opportunities of Free Trade and Economic Zones was held in Tehran, bringing together government ministers and private-sector representatives.

The secretary of Iran’s High Council of Free Trade Zones said many restrictions on the zones had been lifted, making them valuable tools under sanctions if their legal advantages were restored.

He outlined six strategic priorities, including expanding regional cooperation, establishing a new model for border free zones, completing a financial system, rolling out a smart transformation plan and digital economy charter, strengthening exports, and reforming legal frameworks. Improving governance and easing business activity were also listed as key goals.

The official added that the government is working to launch an international stock exchange in the free zones by year-end and is seeking investors. Other plans include creating a technology park in one of the zones and expanding international transport corridors in cooperation with relevant ministries.

Also speaking at the forum, Foreign Minister Abbas Araghchi said Iran’s Kish technology park was a promising start.

He compared Iran’s vision for its free zones to China’s Shenzhen, noting their potential despite sanctions.

“Sanctions have created pressure, but we must not adopt an apocalyptic outlook or think surrender is the only option,” he said. “Sanctions were meant to paralyze Iran, but the country stands firm.”

Araghchi stressed that free zones play a vital role as “economic lungs” when sanctions restrict the country’s trade.

He said Iran remains an attractive destination for investment, with the Foreign Ministry aligning diplomacy with development goals. Talks with the International Atomic Energy Agency were progressing toward a new framework that would address Iran’s concerns, and negotiations with three European states were also continuing.

He emphasized that while diplomacy is important, the government must strengthen domestic capabilities, including free zones, without waiting for foreign talks.

Economy Minister Ali Madanizadeh, for his part, said financing export-oriented projects and supporting free zones are priorities for his ministry. “The path to development passes through free trade zones,” he said, criticizing Iran’s history of government intervention.

He argued that privatization and export-focused strategies, with a strong role for the real private sector, would transform the zones into engines of growth.

One zone will be dedicated specifically to the digital economy, he said.

The event concluded with awards presented to top entrepreneurs, investors, and managers in the free zones.

In late July, President Masoud Pezeshkian launched a national smart transformation initiative for the country’s free trade and special economic zones, unveiling three digital platforms aimed at boosting transparency, efficiency, and tourism.

The project includes a digital tourist card system to facilitate purchases by foreign visitors, an online platform offering hotel and restaurant discounts, and a cargo management system for real-time truck scheduling and shipment tracking.

Developed in collaboration with domestic tech firms and knowledge-based companies, the project is part of a broader strategy to transform Iran’s free zones into next-generation digital economic hubs.

Officials say the initiative is expected to streamline service delivery, enhance governance, and reduce the impact of sanctions through increased digital resilience.

Over time, the system will integrate additional service chains, potentially reshaping the role of free zones in Iran’s economic governance model.

The government says the project also supports improved transparency, better resource management, and a more agile administrative framework aligned with the strategic goals of the Free Zones Council.

Iran's free trade zones play a crucial role in facilitating trade, investment, and tourism by offering tax incentives, reduced tariffs, and streamlined regulations. The southern zones, such as Chabahar, Kish, and Qeshm, serve as key gateways for trade with the Indian Ocean, while northern zones like Anzali and Mazandaran provide critical access to the Caspian Sea region.

The Chabahar Free Zone, in particular, holds strategic significance as a transit hub connecting Iran to Central Asia, Afghanistan, and India via the International North-South Transport Corridor (INSTC). Meanwhile, Kish and Qeshm are pivotal for tourism and energy-related industries, with advanced port infrastructure to support containerized and bulk cargo handling.

Officials emphasize the need to address challenges, including infrastructure development and modernizing port facilities, to fully capitalize on the economic opportunities offered by the free zones.

The establishment of free trade zones (FTZs) in Iran dates back to the Iranian calendar year 1368 (March 1989 - March 1990) following the fall in the country’s oil income in the preceding year which prompted the government to promote non-oil exports.

The first two free trade zones of Iran were established in the south of the country. The first one was Kish Free Trade Zone established in 1368 on Kish Island in the Persian Gulf and the second one was Qeshm Free Trade Zone established the year after on Qeshm Island in the Strait of Hormuz. 

Some five other free trade zones have been also established in the country since then, including Chabahar in southeastern Sistan-Baluchestan Province, Arvand in southwestern Khuzestan Province, Anzali in northern Gilan Province, Aras in East-Azarbaijan Province and Maku in West-Azarbaijan Province, both in the northwest of the country. 

The development of existing free trade zones and the establishment of new FTZs has become one of the major economic approaches of the Iranian government.

MA