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Always be wary when someone tries to oversimplify a very complex concept in order to create a “hard sell” infomercial. What Ben does here is promote Freeports as a purely positive no-brainer without addressing the “dubious” issues which surround Freeports. So I will: thread
/1 https://twitter.com/BenHouchen/status/1314523288442470402
/1 https://twitter.com/BenHouchen/status/1314523288442470402
The aim, as Ben States, is to attract and incentivise new business activity by offering low/zero import tariffs and comparatively lower business rates, corporation tax and even direct subsidies as well as (invariably) lower standards of employment protections/2
To be fair, Ben reassures is that there are no plans to “level down” our environmental & employment standards, BUT it’s worth remembering that we’re about to hit a recession and will be competing against the EU - who also have Freeports... /3
The fact is, the regulatory relaxations associated with Freeports often do relate to employee protection, exemption from minimum wage, erosion of health & safety standards and even levelling down of product standards.
Then there’s the tax issue./4
Then there’s the tax issue./4
Offering such attractive corporate incentives for investment has the obvious knock on effect of shrinking the already sparse public purse. Who will have to account for this deficit and who will suffer as a result of further depleted public serves? /5
As this recent FT article states, there is no real evidence that Freeports actually offer any significant benefits to the immediate surrounding area. /6 https://www.ft.com/content/7ee9e853-bea6-4797-9119-f7e20cdae3c0
Instead, all that tends to happen is that existing businesses simply relocate into the Freeport area, allowing their owners to capitalise financially. Nobody else in society tends to benefit from Freeports. /ends. (For now...)
