The UK government is shaping itself to attracting international businesses and investors now that it is out of the EU.
With Brexit done, the United Kingdom plans to announce the location of up to 10 new free ports – scheduled to begin operating in 2021 – by the end of this year, the government said.
As the UK develops its own trade policy for the first time in decades after leaving the European Union at the end of January, the government has launched a 10-week consultation setting out its plans for the free ports, also known as free trade zones.
Once the consultation is completed, sea, air and rail ports will be able to bid for free port status.
“Freeports will unleash the potential in our proud historic ports, boosting and regenerating communities across the UK,” Chief Secretary to the Treasury, Rishi Sunak, said in a statement.
“They will attract new businesses, spreading jobs, investment and opportunity to towns and cities up and down the country.”
Free ports are areas where imported goods can be held or processed free of customs duties before being exported again. They can also be used to import raw materials and make finished goods for export.
The government said it was considering tax measures aimed at increasing investment in infrastructure, construction and machinery in free ports to raise productivity. It could also use tax changes to reduce the costs of hiring workers in free port sites, it said.
Prime Minister Boris Johnson will announce the UK’s first post-Brexit budget on March 11, which his administration has signalled will include a boost in infrastructure spending.
“Backed by a pro-enterprise Budget for skills, infrastructure and innovation, business can help kick start a new decade of UK growth and job creation,” Carolyn Fairbairn, director-general of the Confederation of British Industry said in a statement on Monday. “And it is investment that will enable all regions of the UK to share in rising prosperity.”
By boosting spending in northern England and the Midlands, Johnson is looking to reduce regional disparities and reward areas where lifelong Labour supporters backed his Conservatives in the election. The plan will include 40 million pounds ($52m) for 5G wireless networks in rural areas and investment in mass transit, according to a government official on Sunday.
Free ports could be used to trial customs, transport and green technologies before they are adopted more widely across the economy, the government said.
But free ports are not without controversy. The idea has been criticized as a backdoor route for tax evaders. The European Commission said last year that free ports were vulnerable to money laundering or terrorism financing.
Some trade experts say the net benefit of free ports is limited and they often just redistribute economic activity from elsewhere in the country.
SOURCE: NEWS AGENCIES