It has emerged that local politicians are in talks with Middle East investors and the government to try and secure a multi-billion-pound deal to create a new superport in the North East.
It is believed the scheme could be backed by Abu Dhabi based wealth fund Mubadala. Last month the investment company announced a joint venture with the UK government that, over the next five years, could see up to £5 billion spent on life sciences, technology, clean energy and infrastructure.
It is understood that as part of the deal discussions have taken place about a PD Ports takeover deal that would see the vast Teesside gateway location absorbed into the site. PD Ports are one of the major UK port groups, operating from 12 locations across the country.
A Government source has told a national newspaper: “One of the projects that we are working on with Mubadala is the acquisition of PD Ports, and to bring PD Ports into the wider ownership of Teesworks with various private partners.”
In his March budget, the chancellor, Rishi Sunak granted Teesport the ‘game changer’ freeport status, in a move that will “turbo charge Teesside’s economy” bringing thousands of jobs and a £3.2bn boost to the area.
Following the announcement Tees Valley’s Conservative Mayor, Ben Houchen issued a statement saying: “We’ve successfully secured the UK’s largest free port, the ownership of thousands of acres of brownfield land, millions of sq. ft of approved planning for factories, a new heavy lift quay and investors who have signed on the dotted line, and I’m in continuous discussions with Government and potential investors and funders to build on this fantastic start so we can create much needed jobs and opportunities for local people”.
He added: “What happens over the coming months is going to be crucial if we want to capture the once in a generation opportunity that now stands before us.”
Covering 4,500 acres, the Teesside Freeport will be the largest in the UK. It is hoped the development will create more than 18,000 jobs and provide a £3.2billion boost to the local economy over the next five years.
The Teesside Freeport covers sites across the region, including Teesworks, Wilton International, Teesside International Airport, the Port of Middlesbrough, the Port of Hartlepool, Liberty Steel and LV Shipping. The site would cover approximately the equivalent to 2550 football pitches.
The Teesside bid was one of eight successful bids across the country. All the bids were scored for performance on trade and investment, regeneration, innovation, pace of delivery, and private sector involvement.
It has emerged that another North East bid, centred around the Tyne, was ranked third out of 18 submissions on the Government’s criteria, narrowly ahead of the bid by neighbouring Teesside and significantly higher than several other successful bidders.
Although Teesside scored medium in three of the criteria and high on two others, on paper at least the North East Tyne bid edged it, scoring two mediums, two highs and one medium high.
The final decision was made by Mr Sunak and Communities Secretary, Robert Jenrick who agreed the Teesside bid should leapfrog the North East Tyne because of its “stronger alignment with Government policy, in particular the Net Zero agenda and the prime minister’s 10 Point Plan.” Locally these claims have been refuted because environmental factors were already included in the scoring system and the bidding prospectus.
It was hoped that a free trade zone across the ports of Tyne, Blyth and Sunderland, plus Newcastle Airport, the Nissan plant at Sunderland and the IAMP business park could create tens of thousands of jobs.
North of Tyne mayor Jamie Driscoll said: “The evidence shows we put in an exceptionally strong joint freeport bid from the North and South of Tyne. We scored higher than East Midlands, Solent, Plymouth and South Devon, Teesside, and Liverpool City Region, who all got freeports.”
The disclosure of the North East Tyne bid’s high ranking has re-opened a row on the way the Budget appeared to favour the Tees Valley over the rest of the North East, with six major schemes in that area getting funding from the Chancellor.
Critics have pointed out that these decisions have been made just two months before the area’s mayoral election. The satirical magazine, Private Eye noted: “What Teesside certainly scores highly on is alignment with the Tories. The outcome won’t harm Mr Houchen and the Tories’ local government election chances come May”. Pulling no punches, it went on to say: “Mr Houchen’s chances have been boosted by Mr Sunak’s choice of Darlington for the Treasury North outpost – once again ahead of arguably more suitable but politically less welcoming cities” such as labour dominated Newcastle.
The row also mirrors one that broke out last year around the Government’s Towns Fund, which appeared to favour seats being targeted by the Conservatives in the 2019 General Election. The Fund gave multimillion-pound funding to relatively prosperous areas ahead of more deprived towns after ministers intervened to overrule officials’ decisions.
Whilst investment in the North East is welcome and long overdue, questions will remain as to whether the preference of the Government for Teesside based projects are based purely on politics.
The Asian Standard contacted PD Ports for comment but has yet to receive a reply.