San José Foreign Trade Zone and
Sister Cities Program
Community and Economic Development Committee
June 16, 2025
Item d(4)
Joseph Hedges, International Affairs Manager
City Manager’s Office of Economic Development and Cultural Affairs The Foreign Trade Zone is a federal
program passed into law by the U.S.
Congress to foster U.S. commerce
and trade.
San José received federal approval
in 1974 to establish the 18th Foreign
Trade Zone in the U.S.
The City administers the Foreign
Trade Zone to facilitate economic
growth, support jobs, manufacturing
and trade.
City of San José – Foreign Trade Zone 18 Grantee
2 • A site in the U.S., through federal
designation, considered to be outside of a
U.S. Customs area.
• Foreign merchandise is admitted into a
Foreign Trade Zone duty free – duties are
paid only if the merchandise enters into
U.S. Customs area.
• A company can delay, reduce, or eliminate
federal duties on foreign merchandise that
is admitted into a Foreign Trade Zone.
Foreign Trade Zone
3 4
• Financial savings and operational
benefits that allow businesses to
maintain and grow U.S. operations.
• Enhances the global competitiveness
of companies operating in the U.S.
• Helps to drive the economy at every
level—national, state and local.
• Provides flexibility for company
operations and protects companies in
times of trade uncertainty.
Foreign Trade Zone Benefits
5 • Activity in 2023:
• $10-$25 billion in merchandise received
• Over $5 billion in exports
• 30,000+ employees
• Activity in 2024:
• 50th Anniversary of Foreign Trade Zone 18
• Three new companies joined
• Activity in 2025:
• April Presidential Executive Order changed the
benefits of operating within a foreign trade zone
Source: Reports submitted by FTZ 18 operators
Recent Foreign Trade Zone 18 Activity
6 • San José is a charter member of
the national Sister Cities network
and established one of the
nation’s first Sister City
affiliations.
• A Sister City affiliation
encourages international citizen
diplomacy collaboration and
exchanges in education, the arts,
economic development, sport,
civic affairs and other community
programs.
San José Sister Cities Program
7 San José’s Sister Cities
Okayama, Japan (1957)* Dublin, Ireland (1986)*
San José, Costa Rica (1961) Ekaterinburg, Russia (1992) Veracruz, Mexico (1975) Pune, India (1992)*
Tainan, Taiwan (1977)* Guadalajara, Mexico (2014)*
*Sister City Program with active community organization 8 San José Delegation Visit to Dublin – September 2024
9 Okayama Delegation Visit
April 2025
10 San José Foreign Trade Zone and
Sister Cities Program
Community and Economic Development Committee
June 16, 2025
Item d(4)
Joseph Hedges, International Affairs Manager
City Manager’s Office of Economic Development and Cultural Affairs