The Welsh ports seeking to get freeport status

Port operators in Wales have confirmed interest in securing freeport status, which would exempt them from tariffs and VAT on goods brought in. As a non-devolved matter the UK Government is looking to established 10 freeports across the UK. The bidding process is expected to be launched in the autumn, with successful sites confirmed by the spring.

The UK Government says goods entering freeports would not have to pay tariffs, import VAT or excise duty until they leave the freeport and enter the domestic UK market, with simplified customs procedures and declarations. However, there are commentators who believe they would have little net economic benefit, with the danger that they mainly just displace business activity from elsewhere. The UK Trade Policy Observatory said its analysis had found that the policy would have little effect in the UK because tariffs were already low.

Associated British Ports has confirmed it is looking at securing freeport status covering all of its ports in South Wales, in Port Talbot, Swansea, Newport, Cardiff and Barry. And having responded to the UK Government’s consultation on freeports the Port of Milford Haven, has also expressed interest. Cardiff Airport, in a move aimed at boosting freight traffic and associated storage and logistics facilities around its terminal, could also potentially bid.

There are also calls for the Port of Holyhead to be granted freeport status. A spokesman for Associated British Ports said: “We are supportive of the UK Government’s intention to grant freeport status to a number of port areas around the UK. Such status, if structured correctly, has the potential to unlock economic growth and bring new jobs to port communities and the wider UK.

“Our ports in South Wales are strong candidates for freeport status, which could prove transformational for those areas and play an important role in supporting the UK Government’s ambition to drive economic growth and innovation, decarbonise and level up the economy.”

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Following the submission of the Port of Milford Haven’s response to the UK Government’s freeports consultation, its chief executive Andy Jones said: “The port continues to advocate for a digitally connected, multi-site freeport covering the Haven Waterway’s nationally significant logistics, processing, engineering and development sites. “Our stakeholders believe there are significant new prospects for their existing businesses while also creating opportunities for growth, new investment, innovation, decarbonisation and clustering within the wider energy and engineering sectors.  Any bid for freeport status will build upon the Port’s natural capital, industrial cluster, hard infrastructure and skills-base.” Conservative MP for Anglesey, Virginia Crosbie, has also pressed the case for the Port of Holyhead.

She said: “A freeport will transform the fortunes of Holyhead and Anglesey, encouraging greater development, investment and tourism to the island. I am incredibly proud to represent Holyhead and will do my best to try and secure its freeport status.” The UK had seven free ports between 1984 and 2012.

Finance Minister Rebecca Evans said while there remained unanswered questions over freeports, the Welsh Government, led by Economy Minister Ken Stakes, was engaging with UK ministers. She said: “It’s one of those issues and areas where we really need the UK Government to be properly and fully engaging with us. “This is a reserved matter but the implications for us could be very significant here in Wales.

“We don’t want to find ourselves in a situation where freeports lead to any lowering of environmental standards, of labour market standards for example.

“We don’t want to find ourselves in a situation where tax breaks make other companies or Welsh firms uncompetitive.

“And we certainly don’t want to find ourselves in a position where economic activity is displaced as a result of those freeports as well.”

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