20/07/2021 – Infrastructure / Freeports / UK / Investment / IFS / Technology
OPINION – Wider investment in local infrastructure ecosystem is key to freeport ‘levelling up’ success
Freeports present an opportunity to rebalance economic prosperity in the UK. However, investment into the local infrastructure ecosystem within which those hubs are set to exist will prove crucial if the PM’s ‘levelling up’ agenda is to succeed.
Between 1984 and 2012, the UK had seven freeports, with locations including Liverpool, Southampton and the Port of Tilbury. Now, as part of the government’s ‘levelling up’ agenda, freeports – typically located around shipping ports, or airports – are set to make a comeback.
In his 15th July “levelling-Up speech, UK Prime Minister Boris Johnson announced that his government would “use new post Brexit freedoms – such as freeports – to drive… investments across the UK”. Back in March 2021, it was announced that there would be eight such freeports for England at the following locations: East Midlands Airport; Felixstowe & Harwich; Humber; Liverpool City Region; Plymouth and South Devon; Solent; Teesside, and Thames.
The advantage for business located at freeports is that goods arriving into such sites from abroad are exempt from tariffs, with taxes only paid if the goods leave the freeport and are moved elsewhere in the UK. Otherwise, they are sent overseas without the charges being paid.
Freeports undoubtedly present an opportunity to rebalance economic prosperity in the UK. However, in order to provide the optimal chance of creating meaningful economic impact in the areas that have been left behind, there must also be consistent and considered investment and attention paid to the local infrastructure ecosystem in which they will exist – and it remains to be seen if the Government’s plans go far enough in that regard. That’s the view of Antony Bourne, Senior Vice President at IFS – a technology company that helps businesses in core industries plan and manage their supply chains.
Ensuring freeports bring wider community value
Mr Bourne said that the recent speech reaffirmed the fact that freeports will be a crucial element of this Government’s levelling-up agenda. “Many will welcome the opportunity to increase UK productivity by establishing modern and efficient centres of excellence that can attract businesses to and create skilled jobs in parts of the country that have in recent years felt economically left behind,” he remarked.
“The enhanced allowance for building and investing in plant and machinery seen in the Chancellor’s recent budget – as well as the tariff free trading freeports enable – are incentives that are necessary to encourage businesses to take up the opportunity, and catalyse the type of changes the government wants to see outside of London and the South East,” he continued.
“However, these also need to be supplemented by other incentives for the communities in which the freeports are located to maximise the wider stakeholder benefits and ensure the initiatives bring value to more than just shareholders,” Mr Bourne advised. “To provide the optimal chance of success – for the freeports themselves, and for the wider levelling up strategy – there needs to be consistent and considered investment and attention paid to the transport links, local housing and communications technology, such as 5G and ultra-fast networking, that serve freeports. This will promote wider development around freeport zones and could see them become tight-knit communities with optimised infrastructure and enhanced social amenities. Clearly, none of this will happen overnight, but whether the Prime Minister’s levelling up plans go far enough to make this a reality remain to be seen.”
Latest issue – Vol 3/21
– Security focus
– Global gas supply risk
– Deepwater dangers – Cyber-security on deepsea drill rigs
Suriname International Petroleum & Gas Summit and Exhibition 2021
International “Astana Mining & Metallurgy” Congress
Ukraine Gas Investment Congress 2021
PARKOVY Convention and Exhibition Center, Kyiv, Ukraine