Humber free ports would make every household £1,500 richer, says top economist
Coal coming in to Associated British Ports' Humber International Terminal at Immingham
By Grimsby Telegraph | Posted: 18 Jun 2018
Turning the Humber's four key ports into free ports would make every household in the region £1,500 better off, according to a report published today.
Grimsby’s seafood industry was mocked last year for suggesting free ports be established on the Humber – a move that would effectively give the leave-backing region an exemption from any post-Brexit taxes.
But after gaining the backing of estuary giant Associated British Ports (ABP) and political support from high profile MPs and ministers, a leading economist has now done the maths and says the numbers stack up.
A free port is a zone within a country that is treated, for customs purposes, as an independent jurisdiction where domestic import and export taxes do not apply.
According to economic modelling done by former Treasury economist Chris Walker, establishing free ports and enterprise zones – areas where tax breaks apply for manufacturers and specialist industries – would make every household richer to the tune of £1,500 a year due to increased regional revenue.
Free ports would create as many as 64,000 high-value jobs and add £3.8 billion annually to the local economy, according to Mr Walker’s research.
His findings have been published by Mace, a British consultancy and construction company behind major projects such as Hull’s wind turbine blade factory.
Mace is calling on ministers to apply “supercharged free port” status to seven ports across the North of England as soon as the transition period with the European Union is over in 2021 to ensure the country is “ready to fulfil its global trading potential on day one” of its new future.
The EU’s anti-competition rules currently prevent member states from setting up free ports but the UK’s independence after 2021 could open the door to a more global trade policy.
The seafood processing industry supports creating free ports in the Humber (Image: Seafish)
As well as the Humber, Mace’s Insights 2018 report recommends free ports are created at Tees and Hartlepool, Liverpool Port, the Tyne, and Manchester Airport.
Mace predicts that having seven “supercharged” free ports could boost international trade by £12bn overall and add £9bn a year (double the current economic output of York) to the UK’s GDP.
Steve Gillingham, the northern director at Mace, said: “Our ports in the north make up some of our country’s greatest assets – with Grimsby and Immingham (the largest port [by tonnage] in the UK) being leading examples.
“Transforming these ports into supercharged free ports would ensure the region is well placed to drive post-Brexit growth and help rebalance the UK economy.
“This would not only drive industrial and economic development, but also create thousands of jobs which would in turn help to reduce inequality.”
Dafydd Williams, ABP's Humber head of communications and public affairs
Dafydd Williams, ABP’s Humber communications chief, said: “We welcome the report by Mace which reinforces the position we have taken for a while – that free ports have the potential to provide manufacturing in the UK with a competitive edge once we have left the European Union.”
Supporters suggest creating free ports on either side of the North would lead to better rail and freight connections being built while also providing economic uplift in heavily leave voting areas.
Lord Jim O’Neill, a major backer of the Northern Powerhouse concept and a former Treasury minister, said: “Rebalancing the UK’s economy is crucial to the future success of the whole country.
“The creation of free ports in the North of England will create opportunity, boost growth and free businesses to compete on the global stage.”
The report bases its findings on research into how US free ports have benefited the country’s economy and on the basis that the UK’s trading relationship with the EU, US and Canada will remain the same after Brexit with no additional border checks required.
According to private polling done by Survation for the report, 4 out of 5 people in Britain would support the creation of the so-called supercharged free ports, with 60 per cent of those interviewed in Yorkshire and the Humber in favour.