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The plan to bring a free port into south Essex has left councillors in neighbouring Southend divided over the potential benefits.
Port of Tilbury and London Gateway announced they are joining forces to submit a bid to create the port, which could make south Essex the “port capital of the UK”.
The pair say the plan would mean the creation of up to 36,000 jobs across the region.
However, with the free port allowing goods to be brought into the country without businesses facing import tariffs, Southend Labour councillor Matt Dent said he fears it will not create new businesses but simply move them from other areas such as Southend.
He said: “In the past free ports haven’t really been an unfettered success when they have been implemented but if the Port of Tilbury and London Gateway believe they have something that is workable then it needs to be heard out.
“I do think this is not the slam dunk some want to portray it as.
“Free ports tend to move existing businesses into a certain areas to legally avoid tax. You are not creating new business, just moving existing businesses into this zone.
“This means often you are causing businesses in the immediate area to relocate and that is a potential risk to Southend. The town doesn’t have an abundance of those sorts of businesses but those that we do have may look at this and think its economically advantageous to move out of Southend, which is not something I want to see.”
However, Southend Council’s Labour leader, Ian Gilbert was more positive about the plan.
He said: “Certainly more jobs into the area is a good thing, I already know a fair number of people in Southend who work at the port facilities in Tilbury and so any further jobs created can be a benefit to the whole area.”
The council’s deputy leader, Cllr Ron Woodley (Ind) said he was unsure what was possible with free ports but if this can happen in Thurrock, he would be open to Southend Airport exploring whether that could also be made a free port.
He said: “If it works why not. There is a business opportunity.”
Nationally the Conservatives have been keen supporters of free ports, with Chancellor Rishi Sunak claiming they “will unleash the potential in our proud historic ports” and will attract new businesses “spreading jobs, investment and opportunity to towns and cities up and down the country”.
But the Labour Party has been less enthusiastic. Former shadow chancellor John McDonnell has said there is “little solid evidence” that they create jobs or boost economic growth. He branded the idea as only supporting “the super-rich, who will use free ports to hoard assets and avoid taxes”.
The European Union has also criticised the ports in a 2019 report which warned the trading zones can allow for the movement of fake goods and said they are an emerging threat for “VAT fraud, corruption and money laundering”.