FREQUENTLY ASKED QUESTIONS
What is a Freeport?
A Freeport is an area designated by the Government that acts as a separate, secure customs zone designed to attract major domestic and international investment. Businesses operating within a Freeport receive more attractive tax and tariff benefits, greatly assisting imports and exports. The enterprise hubs and new employment areas will benefit from Government regeneration funding, tax reliefs and a supportive planning framework. The Government wants them to be national hubs for trade, innovation and commerce.
How exactly does it work and how would it give the region an advantage over other areas?
Freeports are not a new idea and there are many around the world. The Government has developed a new UK model for Freeports that will provide tax and customs benefits for businesses located in Freeport customs and tax sites, with a strong focus on innovation and decarbonisation.
Under our Freeport model, manufacturers will benefit from tariff benefits on imported components and simplified customs procedures. This could be particularly beneficial for smaller companies, as our innovative digital model will reduce the financial and administrative costs of applying for customs relief and tracking the movement of goods between ports and industrial sites.
Why is the North East a good region to have a Freeport?
Experts predict a Freeport would boost the local economy by over £3.4 billion, while improving long-term global competitiveness. Over 30,000 new jobs are expected to be created for the region, of which 13,000 are highly paid ‘better’ jobs. A further 31,000 jobs will be generated in the construction industries.
As we recover from the impact of Covid-19, a Freeport would help to stimulate the economic regeneration of the North East and support our drive to be at the forefront of the UK’s green energy future. The Freeport tax sites will create new, green jobs in some of our most deprived communities, with wider economic benefits that will spread to the whole region.
Approving our bid would provide a clear signal of intent to level up the North East.
What’s different about the North East bid to the others?
Unlike others, we are concentrating not only on the physical, but also the digital and innovation elements of our model. This will mean that companies and organisations vital to the region’s economy will be included in benefitting from freeport status with the creation of a cyber boundary rather than just a physical one. We have the most ambitious plans for delivering net zero and digital-first operations.
What is the timescale?
Bids closed on February 5th, with a ministerial decision due in spring 2021. 10 Freeports are due to be agreed across the UK. Work is ongoing to prepare the ground to ensure we hit the ground running to realise the economic benefits as soon as possible.
Where are the customs and tax / development / employment sites?
• Port of Tyne – primary customs site – and c200ha of tax site
• Port of Blyth / Northumberland Energy Park – customs sub-zone – and c200ha of tax site
• Newcastle International Airport – customs sub-zone
• Port of Sunderland – customs sub-zone
• Nissan – customs sub-zone
• Vantec – customs sub-zone
• International Advanced Manufacturing Park – customs sub-zone – c200ha of tax site
Other sites are to follow to extend the benefits to SMEs and new entrants in response to emerging business opportunities. Future sites could include:
• Ashwood Business Park
• Tyne Marshalling Yard
• Swans/Neptune Yard
• Jade Business Park