Wednesday, March 3, 2021

Chancellor Announces Eight New Freeports in Budget Speech

Winners and Losers in Race for Investment
Shipping News Feature

UK – The Chancellor's final announcement in today's Budget speech was the confirmation of where the country's new tranche of Freeports are to be located.

This announcement was among the most eagerly awaited by the British logistics community, particularly by those ports and other investors who were looking to get the slice of a somewhat contentious pie, given the mixed reputations of the free trade zones around the globe. Rishi Sunak said:

”[This is] a policy to bring investment, trade and most importantly jobs right across this country. To replace the industries of the past with green, innovative, fast growing new businesses. To encourage free trade and reinforce our position as an outward looking trading nation, open to the world. A policy we can only now pursue now we are out of the European Union - Freeports.

”Freeports are special Economic Zones with different rules to make it easier and cheaper to do business. They’re well established internationally but we’re taking a unique approach. Our Freeports will have simpler planning to allow businesses to build, infrastructure funding to improve transport links, cheaper Customs with favourable tariffs, VAT or duties, and lower taxes with tax breaks to encourage construction, private investment and job creation.

”Freeports will be a truly UK wide policy and we will work constructively with the Scottish, Welsh and Northern Irish administrations. Today I can announce the eight Freeport locations in England. East Midlands airport, Felixstowe and Harwich (Freeport East), Humber, Liverpool City Region, Plymouth, Solent, Thames and Teesside.”

The announcement brought satisfaction from the winners and disappointment from losers with such as Womble Bond Dickinson, a Transatlantic law firm with a background in such projects, praising the decision to award status to regions in which it has offices, saying:

"We warmly welcome the Government's decision to set up Freeports in Plymouth and Solent. This is excellent news for the regeneration of the areas and to support the regions post Covid-19 economic and social recovery.

"The economic potential of a Freeport in a region cannot be underestimated, it is huge. A Freeport could generate billions of pounds a year and create tens of thousands of jobs nationally and in the region. It will play an important role in strengthening the UK's trading position; it will drive new clean growth opportunities in manufacturing, trade and inward investment.”

Thames Freeport today announced that it was open to do business with new customers just hours after the Government announcement. Thames Freeport describes itself as a ‘digitally linked economic zone connecting Ford's world-class Dagenham engine plant, the global ports at London Gateway and Tilbury, and many communities in urgent need of levelling-up’. Stuart Wallace, Chief Operating Officer at Forth Ports (owner of the Port of Tilbury), said:

“This is fantastic news and we are ready to hit the ground running. The Freeport builds upon the successful completion of our new port, Tilbury2 and provides the platform for further expansion. The Freeport policy’s special economic measures will turbocharge the best of the private sector, attracting value add manufacturing activity to the ports, the Thames Estuary and the wider South East, alongside supporting key infrastructure projects in the coming years. The Thames Freeport will be that catalyst to level up the left behind communities along the estuary.”

His comments were echoed by Dr Graham Hoare OBE, Chairman and Executive Director, Business Transformation, Ford of Britain, and Alan Shaoul, Chief Financial Officer at DP World in the UK, owners of London Gateway, who commented:

“We are open for business and would urge anyone looking to expand to get in touch to find out more about the benefits of locating at Thames Freeport. Our London Gateway site alone has almost 10 million square feet of land that has planning consent, and the capacity to expand materially its operational area and therefore attract new foreign direct investment within the lifetime of this parliament.”

The news that Freeport East, the collaboration between the ports of Felixstowe and Harwich got the go ahead will no doubt also be welcomed as enthusiastically, however not everyone was a winner today as the business leaders, cross party MPs, seven local authorities, two combined authorities and the North East Local Enterprise Partnership who lobbied for a North East England Freeport were left wanting.

A statement from Matt Beeton and Martin Lawlor, each CEO of the ports of Tyne and Blyth respectively, and Lucy Winskell OBE, CEO of the North East Local Enterprise Partnership said:

”Our vision for North East England Freeport was extremely ambitious. We are immensely proud of what we have achieved and the collaboration shown points to a very bright future. Our region’s leaders came forward to demonstrate their public support for the bid and heads of over 40 organisations signed a personal letter to Rishi Sunak outlining why it was so vital.

”The North East England Freeport would have delivered over 60,000 more and better jobs and helped to deliver a multi-billion pound boost to the North East’s industries. It would have secured new opportunities for local communities that have experienced severe economic scarring and been especially badly affected by Covid-19.

”Today’s news was not what we had all hoped for, but we must show the resolve and tenacity the North East region is renowned for and find alternatives. Our proposals contained some fantastic initiatives that we will look to implement irrespective of this decision and our Steering Group will explore how we can take some of these ideas forward.

”We will continue to promote our region’s industrial strengths and the target clusters of offshore wind, advanced manufacturing, automotive and digital innovation, using our world-class ports and manufacturing hubs by other means.”

Photo: Rishi Sunak delivers his Freeports announcement to the House.