Joint freeport bid from Felixstowe and Harwich

Two of the historically busiest ports in England have entered a joint bid for Freeport status under a UK government competition to identify up to ten locations around the country. Felixstowe, known primarily for intermodal traffic, and Harwich for ferry sailings, lie opposite each other on the north and south banks of the estuary of two confluent rivers. Both facilities are owned by Hutchison Ports. This is the second joint-bid to go public, after a collaboration by the owners of Tilbury and London Gateway on the River Thames.

The joint bid for Freeport status from Felixstowe and Harwich has come as no surprise to maritime insiders. Freeport East, as the project is titled, would, say the backers, be a strategic hub linking UK importers and exporters with suppliers and customers across the globe, at the heart of vital trading routes to Asia and Northern Europe. The bid comes only a matter of months after Hutchison Ports surprised the markets by appointing the former UK transport secretary, Chris Grayling, as an advisor.

Rail connectivity a bid factor

The bid has the backing Suffolk and Essex County Councils, and a string of other local authorities and business interests. Hutchison Ports say the bid, if successful, will drive and support the UK government’s local and national regeneration strategies. Freeport East, they say, will build on the existing ports’ excellent road and rail links to the Midlands and the North of England, the destination for almost a third of Felixstowe’s current throughput.

The claim of excellent rail connections may be viewed with some scepticism, particularly from operators who navigate the congested line east from Felixstowe, including the single track section through Cambridgeshire. However, Harwich, which has seen traffic drop in recent years and is far from its heyday in the 1980s, has capacity to spare, and extensive underused rail freight facilities.

What are Freeports?

Designed to attract major domestic and international investment, areas given Freeport status in this competition will benefit from a wide package of tax reliefs, simplified customs procedures, a streamlined planning processes to boost redevelopment, and UK government support to promote regeneration and innovation.

Felixstowe Port. Photo: Network Rail
Felixstowe Port. Photo: Network Rail

The chancellor of the exchequer, Rishi Sunak, said new Freeports will create national hubs for trade, innovation and commerce, levelling up communities across the UK, creating new jobs, and economic recovery. “As we embrace our new opportunities as an independent trading nation”, he said, “We want to deliver lasting prosperity to the British people. Freeports will be key to delivering this.”

Drawing on best practice

At the centre of the new Freeports policy, says a government statement, is a new customs model drawing on international best practice, and building on the UK’s existing customs arrangements. In brief, a firm can import goods into a Freeport without paying tariffs; process them, and then either pay a tariff on goods sold into the domestic market, or export the final goods without paying UK tariffs.

The model has been used successfully around the world. There have also been Freeports in the UK, including Liverpool, Southampton, the Port of Tilbury, and Glasgow Prestwick Airport. The legislation permitting their operation lapsed in 2012. Tilbury is now part of a renewed Freeport bid.

Rail infrastructure enhancements needed

Rail operations could play a significant part in Freeport operations, if sufficient infrastructure capacity is made available. Felixstowe would benefit from a wide-ranging enhancement programme around Ely, in Cambridgeshire, which is currently under public consultation. Harwich, which has rail capacity in place, could deal with a variety of bulk and intermodal cargos, and already has existing links to the automotive logistics sector and the clean energy sector. The Freeport plan notes this and calls for exploitation of wind farm fabrication and maintenance.

Rail operations at Felixstowe are already a tight fit, with capacity limited on lines serving the port (Hutchison Ports)

Following the publication of the Government’s Freeports prospectus last week, George Kieffer, chairman of the project board, said there were compelling arguments to include Freeport East among the selected bidders, not just for the region, but for the country as a whole. “By bringing lasting regeneration and creating new job opportunities to the region the project will support the government’s levelling-up agenda”, he said.

The two-for-one deal of Felixstowe and Harwich, and the prospect of reviving the fortunes of not one but two local authority areas may indeed make a compelling case. If that means a revival in rail freight traffic too – that will be a boon for operators, if something of a headache for infrastructure managers. Like lunch, there’s no such thing as a free Freeport.

Author: Simon Walton

Simon Walton is RailFreight's UK correspondent.

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