What are green freeports? Everything you need to know about the schemes

Inverness and Cromarty Firth green freeport and Forth green freeport were announced as Scotland’s two winning bids in January last year through the scheme agreed by the Scottish and UK Governments.

Green freeport status offers special tax incentives and lower tariffs around ports, with the aim of stimulating economic growth.

READ MORE: What do YOU want to know about Scotland's green freeports?

But what does it mean for Scotland? When will they be operational? And what concerns are there?

We have received an overwhelming amount of reader interest towards the issue, including the queries above as well as whether the scheme is simply a “Westminster power grab” or there being too little public awareness of the impact these freeports will have on local communities.

So over the next few days, we will be speaking with key players and critics of the scheme with a host of exclusive content coming your way.

What is the difference between a freeport and a green freeport?

A freeport, as the UK Government defines it, is centred around one or more air, rail or seaport in England, but can extend up to 45km beyond the port.

The area will have measures including tax relief for businesses such as from stamp duty and employer national insurance contributions for additional employees, and custom duty reliefs.

In Scotland, the hubs will instead be called green freeports – which the Scottish Government say is to reflect their “distinctive net-zero aspirations”.

Scotland's green freeports will be required to contribute towards a just transition to net-zero emissions by 2045, create new green jobs and deliver net-zero benefits. They will also be required to set out how they will support high-quality jobs, salaries and conditions.

When will green freeports be operational in Scotland?

Both of Scotland’s two winning bids – Inverness and Cromarty Firth as well as Forth (map of which is below) – aren’t officially green freeports until the final business case is approved by the Scottish and UK Governments, upon which a total of £52 million of seed funding will be released.

However, only the outline business case needs to be approved before the respective green freeports’ tax sites go live – meaning businesses can start to benefit from special tax incentives and lower tariffs around these ports.

Inverness and Cromarty Firth (above) green freeport’s tax sites go live in a week exactly (April 8), while Forth green freeport is still waiting for approval.

What do freeports mean for Scotland?

The UK Government has argued that the freeport scheme will attract up to an estimated £10 billion in investment and create around 75,000 new, high-skilled jobs.

The CEO of the Inverness and Cromarty Firth green freeport  told The National it could be higher – noting investment from companies like Sumatomo, a Japanese firm that has already agreed to invest £350 million into a major energy project in the Highlands.

The Scottish Government backs the scheme, with Deputy First Minister Shona Robison (above) saying recently that she supports “firm joint action to ensure that the green freeports – and the landowners and businesses operating within them – all live up to a clear set of policy commitments, particularly in relation to our just transition to net zero and fair work principles.”

She added: “We continue to work constructively with the UK Government and the Inverness and Cromarty Firth Green Freeport consortium to get the project up and running as quickly as possible and ensure it has maximum positive impact for businesses, communities and Scotland’s wider economy.”

Are there concerns about freeports in Scotland?

The Scottish Greens are notable critics, with MSP Ross Greer (pictured below) previously calling the plans “greenwashing” and arguing that there is nothing “genuinely green” about the hubs.

Greer has also said that past freeports have not delivered on promised jobs and are an effective way to “throw public money at multinational companies who are already doing their best to avoid tax".

Trade union groups, including the SNP one – have also warned that the plan risks opening a “dangerous unregulated backdoor” which may weaken workers’ rights both within and outwith the freeports.

A briefing paper from a think tank last year warned that freeports might facilitate the illegal import of drugs, wildlife and counterfeit or stolen goods.

The report points out that the European Parliament has called for the abolition of freeports – and there are concerns that the green freeport scheme could impact on an independent Scotland’s ambition to rejoin the EU.

In any case, these questions and more will be answered in The National’s green freeports series – which will be running from April 1 to 5 with exclusive content every day online and in the newspaper.