Wednesday, November 18, 2020

Two Major Port and Logistics Operators Press Ahead with Thames Freeport Bid

However Security Issues Should be Paramount
Shipping News Feature

UK – As the British government launches the competitive bidding process for the establishment of ten new Freeports in the UK, two of the country's biggest port operators, DP World and Forth Ports, have begun to push hard for their collaborative project which we have detailed previously - the Thames Freeport.

With DP’s London Gateway, Forth’s Port of Tilbury and Ford's Dagenham engine plant at its heart, the new proposed Freeport represents some of the UK’s latest freight and manufacturing infrastructure. Enjoying widespread support from trade associations like the City Corporation of London, Essex Chamber of Commerce, plus the Port of London Authority, the sponsors state that a Thames Freeport will drive innovation and encourage next generation logistics, automation, clean growth and advanced manufacturing.

Both DP and Forth point out that they enjoy a network of global and European shipping connections, excellent road, rail and river distribution networks, in addition to unrivalled first hand expertise in operating Freeports. They also state that both ports have consented development land that is available for expansion now, which will improve the opportunities for skilled jobs in the area. Alan Shaoul, DP World UK’s Chief Financial Officer, said:

"Freeports will be an effective way of underpinning Britain’s economy post-Brexit and post-Covid by further enabling trade with the rest of the world and creating zones which will act as catalysts for commerce, creativity and prosperity.”

Freeports are areas of special economic regulation whare goods can be imported,warehoused and reconfigured or even manufactured then re-exported withiur being subject to duty. Stuart Wallace, Chief Operating Officer, Forth Ports, commented:

"The Port of Tilbury and London Gateway are already the most integrated logistics hubs in the UK, harnessing the best-in-class border technologies, with commanding market leading positions across a range of commodities. A Thames Freeport would secure the next stage in the development of our sites, attracting further foreign direct investment, while acting as a test bed for new technologies, including autonomous and electric vehicles, leading to new skills opportunities across the Thames estuary development area."

While both companies are world-leaders in the operation of Freeports, the issue of security and smuggling is one that has always beset such operations. The lack of official oversight means unscrupulous persons and organisations have long exploited what can be a loophole in national security for criminal purposes, a classic recent example of this being the seizure of ammunition in the Maltese Freeport that was believed to be headed for Hezbollah.

In March last year Jean-Claude Juncker, then European Commission president, was slated by colleagues for dismissing concerns regarding Freeports being used in money laundering activities, including one scheme concerning fine arts which he himself had authorised whilst prime minister of Luxembourg.

A special European Parliament committee found evidence of potential fraud on a vast scale, with a web of intrigue hiding who actually owned goods retained in the Freeports, as the duty free status enabled criminals to use the lack of transparency to their advantage.

Such was the concern that in February 2020 that the EU clamped down on eighty-two free ports on the grounds that they were being used for criminal and terrorist financing. Such concerns run parallel with worries over duty and tax avoidance, so beloved globally by money launderers, smugglers and counterfeiters.

With major potential trading partners watching with suspicion at the founding of the new tranche of UK Freeports, it behoves the interested parties that hope to benefit from their establishment, wherever they may eventually be, to be certain that their new projects are not exploited by unscrupulous operators.

Photo: The Ford Dagenham site has its own jetty. Courtesy of Lars Plougmann.