8 minute read
What a freeport means for the East Midlands
In the spring budget, Chancellor Rishi Sunak confirmed East Midlands Airport would be the location for one of eight freeports. After a successful bid involving political and business leaders across the region, the hard work starts now. Some of those involved in the project, including the Chamber, discussed the opportunities it will provide during a webinar hosted by Insider Media.
An “enterprise zone on steroids” is one of the descriptions given to a freeport, a designated area for international trade that will soon be located at East Midlands Airport.
While it will feature similar benefits to enterprise zones, which provide tax breaks, Government support and a hub for doing business between companies in similar sectors – such as the life sciences and advanced manufacturing clusters in Nottingham and Derby respectively – there are hopes the freeport’s value will extend much further.
“Yes, it’ll feature reduced tax and regulation, but the important point is it’s about creating new opportunities,” says Chris Hobson, the Chamber’s director of policy and external affairs.
“Since the Chancellor’s announcement, we’ve had many businesses getting in touch wanting to get involved. The reason businesses are so excited about this right now is that as we come out of the past 12 months, they’re starting to look afresh at where their supply chains are constructed and which markets – whether its geographical or sectoral – they want to be in.
“Having this zone slap bang in the middle of the country, where they can invest and realise some of those amazing opportunities – and we’ve seen in our most recent Quarterly Economic Survey that businesses want to invest in big capex projects – is really exciting.” THE SUCCESSFUL EAST Midlands freeport bid was led by the region’s two local enterprise partnerships, D2N2 and LLEP, with strong backing from cross-party MPs and the Chamber – which had campaigned for a free trade zone linked to the airport since 2018, when it presented the Delivering a Great Future manifesto at Westminster including “The Big Opportunity” this would create for the region.
The pandemic has highlighted the value of the airport’s express freight hub.
It was already the busiest pure cargo airport in the UK and while growth was expected, it’s been brought forward by coronavirus due to the online shopping boom and reduced passenger flights globally narrowing bellyhold alternatives.
Managing director Clare James says: “At the heart of the country, we have this cracking intermodal capability with rail and road networks built around the airport. When you add the inland freeport zone, it’s a very compelling and unique offer.”
Explaining what the freeport area will involve at the East Midlands Freeport - Opportunities in the New Superhub webinar hosted by Insider Media, D2N2 chief executive Sajeeda Rose calls it a “special economic zone” featuring a series of incentives and benefits.
She says: “It will provide customs-free access and streamlined customs arrangements for goods to be imported, processed, used in manufacturing and then exported without any trading costs or bureaucracy.
“In addition, there’s a suite of fiscal incentives for businesses in those sites, such as business rates reduction, and National Insurance and stamp duty exemptions – with the intention being this package will attract new investment into the freeport site.”
It will be based around the East Midlands Airport and Gateway Industrial Cluster in North-West Leicestershire, while also bringing in Uniper’s nearby Ratcliffe-on-Soar Power Station in Nottinghamshire and the East Midlands Intermodal Park (EMIP) in South Derbyshire.
“Collectively, they represent a major opportunity to attract major investment in more than 500 hectares of land and development, expanding the three counties in the East Midlands,” adds Sajeeda, who is now working alongside LLEP on a business case that will require Government endorsement to set up the freeport structures.
AS THE ONLY inland freeport in England, it will have unrivalled rail connectivity from EMIP to all UK ports, and there’s ambitions for a transformed Ratcliffe site – which will be decommissioned by 2025 –to drive innovation into alternative energy sources and green technologies.
It could create nearly 60,000 new skilled jobs and an annual £2bn economic uplift in the region, with investors potentially attracted to the region’s strengths and opportunities in areas such as lowcarbon manufacturing.
The freeport complements well with the East Midlands Development Corporation, a separate project that also seeks to take advantage of the airport and Ratcliffe sites, but also draws in the potential of the Toton HS2 hub station and redevelopment of the nearby Chetwynd Barracks, with the aim of creating 84,000 jobs and adding £4.8bn to the region’s economy.
“The incentives package clearly puts the region on the map and is an accelerant to a lot of the growth we’re looking for in the region,” says Ken Harrison, director of the Midlands Engine-led Development Corporation programme.
“While we’ve identified the
potential for 4,500 homes and 6,500 jobs in Toton and Chetwynd, we’re also looking at the wider area and the potential it has to create a model for living, working, making and moving. We want to connect our citizens across our cities, towns and villages to the opportunities in the freeport area.”
AT A MACRO level, it sounds like a perfectly reasonable jigsaw to piece together, but Peter Ware warns of the need to engage small businesses on the ground with the big opportunities available.
The head of government sector at Nottinghamheadquartered law firm Browne Jacobson says: “We shouldn’t just be talking to businesses about the relaxation of the regulatory regime and the tax incentives, but how there’s some real benefits just from being there – not only is it in a great geographical location but they’d also be surrounded by fantastic businesses.”
And it’s not just those within the freeport that stand to benefit, as it’s estimated the economic impact could be felt across a 45km radius.
Chamber director Chris Hobson adds: “This sphere of influence will create opportunities for businesses but we’ll also see other infrastructure built around it, such as in skills.
“There will be other investment in hard infrastructure like road and rail. Investment begets investment, so we’ll see the benefits spilling over in many ways across the wider region.
An exporting timeline in five stages from A to B
Getting exporting right has perhaps never been more complex in a post-Brexit world. Lucy Granger (pictured), the Chamber’s international services team leader, explains the process – and where her team’s expertise can help.
STAGE ONE Order placed by overseas customer STAGE TWO Order is prepared for export, and is packed and weighed STAGE THREE Transport is arranged and any documents or licence required is applied for or prepared STAGE FOUR Customs declaration is submitted before the goods can leave GB STAGE FIVE Goods are now ready for export
At the point the customs declaration is required, stage three, this is the time to contact your customs broker.
You will need to give them clearance instructions if your agent is acting as a direct representative. Your customs broker will need the following information as a minimum: - Commercial invoice and packing list, including EORI number and eight-digit commodity codes - Information about the mode of transport: Sea –vessel name; air – flight number and date; road and roll-on/roll-off ships – vehicle registration number and nationality - Port of exit (where the goods are leaving GB from) - You may also need to provide further information if your goods require an export licence, dual use licence, or any other approval before the goods can be exported. This can be found on the UK Trade
Tariff at www.gov.uk/trade-tariff.
Once your agent has completed the customs declaration, they will provide an export accompanying document (EAD), the C88. This is required by the port to ensure goods have permission to leave GB. The EAD will give you a movement reference number (MRN), entry number and the date of entry – all unique to your export.
INCOTERMS AND EXPORTING RESPONSIBILITIES
The responsibility of the export declaration depends on the incoterm being used. EXW (ex works) puts the responsibility on the buyer of the goods (importer), although some buyers may struggle with this process if they don’t have a UK agent. All other incoterms put the export declaration responsibility on the exporter (seller). For more information on Incoterms 2020, take a look at the Chamber’s international training courses.
If the goods are moving by road freight, you may need to apply for a transit document called a T1. This will need to be done after the customs declaration has been submitted.
It’s important to keep a copy of your EAD/C88 as this will allow you to prove to customs that the goods have been exported.
If you are trying to find a customs broker, get in touch with the ChamberCustoms team at East Midlands Chamber.
ChamberCustoms is a nationwide complianceled service that covers all ports in the UK, meaning the Chamber can act on any import instruction for goods arriving by sea, road or air to facilitate the rapid clearance of the goods. ChamberCustoms takes the information you provide on the export instructions, and translates the information so that customs can understand.
Email chambercustoms@emc-dnl.co.uk or call 0333 320 0333.
