Freeports: Agreement finally reached between Welsh and UK Governments

It means places like Milford Haven can apply for Freeport status.

The UK and Welsh Governments have finally reached agreement on setting up a Freeport scheme in Wales.It means places like Holyhead, Milford Haven, Fishguard and the South Wales ports can apply for Freeport status. As things stand only one will be established, although ministers say they're willing to consider a second.The scheme is aimed at creating jobs in and around areas which see a lot of overseas trade by allowing tax breaks and other financial incentives.

Freeports offer tax relief to businesses Credit: Steve Parsons/PA

It creates a special economic zone based on the port but sometimes stretching further.

Until now the Welsh Government has refused to work with ministers in London because it said they were offering less money for a scheme in Wales compared to the £25m given to free ports in England.In turn, the UK Government repeatedly said it would establish one in Wales with or without that support, in order to fulfil a Conservative party manifesto pledge.Now the stalemate has ended. The UK Government has agreed to match the funding on offer to ports in England and to share decision-making with the Welsh Government.

Freeports are secure customs zones located at ports where business can be carried out inside a country’s land border. Credit: Tees Valley Combined Authority

The UK Government’s Welsh Secretary, Simon Hart, said he’s pleased to end the disagreement: “I have been critical and I've been impatient over this. I've wanted to get over the line sooner."But we're in the business of arguing with each other but we've we've reached an agreement so I want to put that chapter of this to bed. Now we're in a position where we all agree on what happens next. That's a really good position to be in."As I say, say we're a little bit behind the rest of the UK but forget that for the moment."This is now an opportunity to say to develop this, create some jobs, get some new industries into Wales, and it'll help fantastically in the medium term with ongoing cost of cost of living challenges, not immediately, but in due course, jobs will really help us that's what we need."

English ports Felixstowe and Harwich will be known as Freeport East Credit: ITV News Anglia

The Welsh Government’s Economy Minister, Vaughan Gething, said: “Following considerable engagement between our Governments, I’m pleased we have been able to reach agreement with UK Ministers to establish Freeports in Wales.“The agreement we have reached is fair to Wales, and respects the Welsh Government’s responsibilities in devolved policy areas.“However, we have made it clear to the UK Government that a Freeport will only be implemented if it can be demonstrated, using robust evidence and analysis, that it will support our fair work agenda and deliver long-term, sustainable benefits for Wales, and value for money for Welsh taxpayers.“I very much hope that the UK Government’s willingness to work with the Welsh Government as equals on Freeports can provide a positive model for future co-operation between our governments on other initiatives.”

What do Freeports mean for Wales?This agreement allows the bidding process to begin. Welsh ports will be able to put forward their business cases to win the status.Wales has around 30 ports. Holyhead is the busiest followed by Milford Haven, Fishguard, Cardiff and Newport.Both governments say there could also be a second free port established here in Wales.Simon Hart said: “I’m not allowed to have a preference as part of the decision making process, all I all I know and hope is that there will be a number of really good quality bids coming in.“And of course, although our commitment is to one, we have said and this is important, we have said that if there was a really good top quality second bid, we're not going to - we’re going to leave the door ajar for that.”