UK freeports to be boosted post-Brexit

Up to ten freeports are to be created after the UK leaves the EU on 31st October, status for which ports and airports across the country will soon be able to bid. International Trade Secretary Liz Truss MP said Friday these manufacturing and services trade hubs could be free of unnecessary checks and paperwork, and will offer customs and tax benefits.

Expected to transform the country’s ports and airports just as freedoms transformed London’s Docklands in the 1980s, these new zones are expected to reduce costs and bureaucracy, encouraging manufacturing businesses to set up or re-shore.

"Freedoms transformed London’s Docklands in the 1980s, and freeports will do the same for towns and cities across the UK. They will onshore enterprise and manufacturing as the gateway to our future prosperity, creating thousands of jobs," Truss said.
"We will have a truly independent trade policy after we leave the EU on October 31. I look forward to working with the Freeports Advisory Panel to create the world’s most advanced freeport model and launch the new ports as soon as possible."

Thousands of free trading zones currently operate successfully around the world. The US has 250 such zones, employing 420,000 people.

In focus: The freeport model (Source: Department for International Trade)

There are many freeport models across the US, known as Foreign Trade Zones. One such port is in Miami, which sees over 7 million tons of cargo pass through its port every year. Businesses within the zone can import, warehouse and re-export products duty-free. This cuts down costs for businesses, helping them become more globally competitive.

Businesses can also defer paying tax on their products while they are stored on site, adding peace of mind for businesses looking to manage cash flow and respond more quickly to spikes in demand for their products. Freeports with less regulation doesn’t just help businesses cut down on paperwork, but they offer greater flexibility on when, where, and how they trade.

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