The Chancellor of the Exchequer, Rishi Sunak, confirmed in his March Budget that two out of eight English Freeports will be located here, in the Midlands.
Announcing the Freeports of Humber Ports and East Midlands Airport, the Chancellor said the Freeport policy is “on a scale we’ve never done before” and will be key in creating jobs as well as making it easier and cheaper to do business.
With this announcement, partners are now focusing on how investment and new supply chain opportunities can be maximised across the whole of the Midlands to make the most of the new benefits offered by these international trading hubs.
The Midlands exports more than any other region in England after the North East making access to international gateways critical to the economy. Both Freeports will provide greater opportunities to strengthen key economic routes, including the A46/A1 and the A50/A500 corridors.
Alongside access to Humberside and East Midlands Airport, the A1, the East Coast Main Line and food clusters in the south, Greater Lincolnshire’s ports and logistics sector accounts for over 25% of UK rail freight, connecting to the major energy and manufacturing providers in the North and the Midlands.
As one of the largest and busiest port complexes in the UK, the Humber Estuary currently accounts for 23% of all goods traveling through English ports, adding £7.6 billion GDA to the UK, and supports around 35,000 jobs.
The East Midlands Freeport, including Ratcliffe-on-Soar power station and the East Midlands Intermodal Park (EMIP), will be based around the East Midlands Airport and Gateway Industrial Cluster (EMAGIC). East Midlands Airport is the UK’s largest pure cargo airport carrying over 370,000 tonnes of cargo a year with a value of around £40bn.
The announcement also recognises the important role of Local Enterprise Partnerships to convene and develop forward-thinking projects, and the power of local collaboration from both the public and private sectors and politicians to drive forward the Midlands role as the heartbeat of Britain’s economy and a significant gateway for international trade.
Both Freeports offer benefits to businesses located within them as they are areas where taxes and tariffs do not apply. Businesses can import goods or raw materials, make finished products, store them and re-export them without paying any tax charges, which they would pay if located elsewhere. The taxes are only paid if the goods leave the Freeport and are moved elsewhere in the UK.
In England, companies inside the sites will also be offered temporary tax breaks, most lasting five years. These include reductions to the tax companies pay on their existing property and when they buy new buildings. Employers will also pay reduced national insurance for new staff.
Sir John Peace, Chairman of the Midlands Engine said:
I am delighted that the Chancellor’s Budget Statement recognises the huge potential for economic growth represented by Humber Ports and East Midlands Airport by announcing that they will become the locations for two of the eight new Freeports in the UK.
Taken together, both Freeports within the Midlands Engine will be transformational catalysts for widespread changes and a key component of levelling up the Midlands. They will play a crucial role in driving up economic potential, rapidly accelerating existing initiatives, tackling skills and productivity gaps, increasing investment and delivering long term growth in our region.
Most significantly, the Freeports of Humber Ports and East Midlands Airports will further enhance the central role of the Midlands Engine as a global gateway for the UK – building on our position as a proven powerhouse of international trade.
The focus on green growth measures is also welcome, as the Midlands continues to play a central role in driving the new Green Industrial Revolution, and I am delighted too, with the Towns Fund announcements. Success here reflects the considerable work led by partners and recognises the importance of our regions’ towns, their hinterlands, and the critical role they play in levelling up every part of the Midlands Engine.
A copy of the full press release is available to download.
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