If there is one thing I think we can rely on from Boris Johnson it is that he is inept. He promises much , but will persistently fail to deliver. This will be a reason why his politics will very rapidly become more repugnant; he will need them to do so to fill the void created by his own incompetence.
The latest evidence of that incompetence comes from the FT on the issue of freeports. The story is available from this tweet:
Here we go again. pic.twitter.com/o1wtmhvHMG
— Tim Walker (@ThatTimWalker) May 9, 2021
Liz Truss seems to have forgotten to include freeports in her renegotiation of trade deals following Brexit. The result is that many of them will not be nearly so free at all.
But then, as I was noted as saying in an article on freeports in Investment Monitor last week, freeports were always an idea that were not solving any known problem:
“The shortage is of ideas — there is ample capital,” says Richard Murphy, director of the Corporate Accountability Network and a visiting professor of accounting at Sheffield University. “The development of a free port doesn't improve the number of ideas that are available for activity.”
I added:
“I don't get what this is all meant to be about — unless it is simply another bung,” says Murphy. “Bluntly, that is what I see it as — cronyism.”
With the capital allowance offering already undermined by Sunak's so-called ‘super deduction' and now this even the bung looks pretty poor right now.
Unless, of course, there is another reason for this policy. And that is to undermine the whole regulatory environment of the UK. I presume that is the real purpose. By providing creeping deregulation that plan is to undermine the power of regulation where it is supposed to remain in use. And that way government itself is undermined.
Thankfully it looks for the time being as though Johnson is not that good at that. But the process is ongoing, and corrosion once it starts spreads. That's what Johnson hopes.
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As I understand it, it is worse, because these tariffs do not apply to EU freeports – so ‘sovereign UK’ freeports would actually have been better off if the UK had remained in the EU…
Amusing
Well I never Peter! Quelle surprise, ha ha ha. Yet another one of their stupid ideas undermined by these clowns’ incompetence.
The more these chest beating jingoistic fools blather about ‘Global Britain’, ‘world beating’, etc etc, the more their own corruption, incompetence and dishonesty undermine the very things they claim to be promoting.
Wouldn’t it be nice if we had a leader of a major political party calling out the utter shiteness of Freeports?
Wouldn’t it be nice if we had a leader of a major political party calling out…..generally
🙂
As I pointed out on Budget Day – there is only one Freeport that matters and will function – London Gateway.
It is in the ‘not deprived’ South East
It will not be using the local manufacturers adding value with raw materials and then exporting – wages/rents/house prices in the SE are not the cheapest in the country.
It will only ever use the ‘banking’ section of that Budget establishing FP’s, that Rishi and Bozo the clown announced on the BrexShit cake being pulled out of the oven for their mad hatters party.
I gather from respected trade authority Dr Anna Jerzewska that, if I have it right, agreements made in national treaties don’t cover Freeports which by definition are separate customs territories. Her thread on the subject is here https://threadreaderapp.com/thread/1391672668114538505.html She ends by saying “This is not news
This is not a fiasco
Please remember that the whole reason freeports function the way they function is that they are a separate customs territory.”
I also understand this could have been waived but wasn’t
The provisions of the TCA on rules of origin also create an interesting problem for any enterprise using a freeport for trade with the EU (ignoring VAT and other wrinkles). As many firms (especially in the textile industry) are already running into problems with this component, the idea of the freeport with its emphasis on low cost conversion of imported materials and components, is a nonsense.
Agreed….
How would the TCA cover the Freeports though if they’re independent customs territories, especially if they’re to be used as stepping stones to Charter Cities or the like? Jerzewska’s got me thinking now…
Hi Richard,
Third para from end has “bing” for “bung”. Also, second para from end has “power of revaluation” which I take it should be “power of regulation”.
Only bothering to mention because I think your post will be even better for any future reading with these minor corrections.
Thank you