Shipping and Brexit – what is needed from the Autumn Statement?
If asked to run off a wish list for announcements that might support the Shipping industry, a number spring to mind: fuel duty being probably the most significant right now as crude prices rise and this feeds into freight operating costs.
However, if asked what might help the industry prepare for Brexit and the brave new world we find ourselves sailing towards, with or without a paddle, it is harder. We just do not know what trading environment we will be operating in especially with the rest of EU.
So I am looking towards a relaxation of the planning laws. I shall explain. This is about creating the right environment for the Shipping industry to be able to adapt to a post-Brexit world. We know a relaxation is in the government’s mind, and of course Philip Hammond himself has a background in property development; that is mostly about the residential market, but a relaxation could provide an advantage for industry too.
Take this as an example. Lets say we end up with a hard Brexit, and end up with WTO tariffs on our trade through the Shipping channels with the EU. Tariffs mean increased prices on imports, a proportionate increase in duty, and increased prices leading to cash flow issues and the consequential need for funding. A bonded warehouse can help, and duty is only levied as the goods leave the warehouse, provided a cash flow respite. OK, not a complete answer, but a help.
Are there enough bonded warehouses? No. So at some point the industry needs to think about building more capacity into the system, which brings us full circle to planning. We have a tortuous planning system in the UK, and we all know that this hinders industrial development. A relaxation here would provide an investment incentive, and once Brexit negotiations start and the Shipping industry is better able to perceive the direction and probable outcome, a chance to plan.
Bonded warehouse capacity is just an example. But this is why I look to a relaxation of the planning laws in the Autumn Statement – and I think we are going to get it.
If you would like further information on the topics discussed in the article please contact Duncan Cochrane-Dyet, speak to your local MHA MacIntyre Hudson advisor or send enquiry.