UK: How Freeports Undermine Local Democracy

5th September 2023 / United Kingdom
UK: How Freeports Undermine Local Democracy

As spaces where local politics meet global market forces, freeports are becoming sites where new political logics are developing. Alexandra Hall discusses this process and looks at the potential political consequences.

In late 2021, the first and largest of the new UK freeports opened for business on Teesside. Spearheaded by the Tees Valley Mayor Ben Houchen and the flagship of the Tory “levelling up” agenda, Teesworks promises to regenerate, innovate and create high-skilled jobs in a region that has suffered several decades of economic decline. However, actual regeneration efforts have so far painted a less-than-rosy picture of the freeport’s expansion plans.

Soon after Teesworks’ launch, photographs of dead and dying sea life on the beaches of the North-East coast began circulating in the British press. Government officials, including representatives of Defra and CEFAS, have since been at loggerheads with marine scientists, local activists and members of the fishing community over what is to blame. The official line remains that an algal bloom in the area caused much of the damage. Others point to a pollution incident caused by dredging for the freeport development: the industrial chemical pyridine, historically used to make pesticides and a by-product of steel production in the area, has upset the sediment in the seabed laced with the chemical, poisoning the surrounding marine environment. Alongside the links to sea life die-offs, media exposés of corruption, first appearing in Private Eye News, have also suggested shady backhand deals between the Tees Valley Combined Authority (TVCA), local businessmen and global asset management firms.

We know from previous research that special economic zones (SEZs) – of which freeports are one variety – can facilitate various forms of crime, harm and corruption. Deregulation and profit-maximisation in such enclave spaces can act as force multipliers for everything from illicit trade and elite tax evasion to environmental degradation and labour exploitation. But less has been said about the political dynamics that helped UK freeport policy to be locked in and supported – and even less about how this played out on Teesside.


Historicising Freeports

Taking a step back is important in understanding the model of political and economic ordering on which freeports are based. Recent work points to the ideas of a group of influential twentieth-century thinkers at the centre of the neoliberal project, whose influence is still felt today. Although freeports have existed in one way or another since antiquity, one way of historicising modern SEZs as a specific type of legal-spatial configuration is by situating them as “birthplaces of neoliberal manufacturing globalisation” and uneven capitalist development in the global economy in the latter half of the 20th century.


The new UK freeports can be recast as part of a commitment to a model of ordering in which global economic actors use economic zoning initiatives to carve out corporate Utopias across the globe.


Although the logic of twentieth- and early twenty-first-century neoliberal globalisation has been challenged by several political and economic ruptures of late, the SEZ has not faded away. On the contrary, the global economy has witnessed an expansion of SEZs across many nations. What was once the preserve of countries in the global South pushing export-oriented industrialisation is now also a key policy in the economic models of countries in the global North, ranging from Switzerland’s elite service economy to the UK’s new industrial strategy. The new UK freeports can, therefore be recast as part of a general commitment to a model of ordering in which global economic actors use economic zoning initiatives to carve out corporate Utopias across the globe.


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UK Freeports 2.0

However, freeports are far from Utopian. By their very nature, they are contradictory spaces, problematising normative assumptions about governance, territory and sovereignty. The contradictions abound in the current period where the platitudes of partisan politics in liberal democracies are shattering around us. And perhaps there is no better example of such political chaos than the UK right now. The man at the centre of the new UK freeport agenda was then Chancellor and now Prime Minister Rishi Sunak, stepping in as he did following Liz Truss’s mere 44 days in office. Back in 2016, Sunak argued that EU rules on state aid and the single market “have ensured that modern EU Free Zones amount to little more than storage and warehouse facilities with simpler customs formalities”. His plans for the UK would be far more ambitious as we broke free from EU red tape post-Brexit


By their very nature freeports are contradictory spaces, problematising normative assumptions about governance, territory and sovereignty.


However, freeports in the UK are nothing new. In fact, the UK had a set of freeports in operation until 2012 when their contracts were not renewed, and they were ultimately seen as a policy failure. The government has argued that the new plans offer ways for sites to interact, a range of new tax benefits, and seed funding for innovation and infrastructure plans that did not previously exist. If we take a drive around Teesworks, a site stretching across 4,500 acres encompassing already existing industrial sites, seaports and an airport, we might assume that in practice this would simply mean underlying changes to the institutional framework of structures, rules and norms. A tweak to legislation here, a pot of seed money invested there. That might have been believable until the real effects of the actual changes bubbling under the surface began to break through, dealing a visceral blow to the narrative peddled by elites at the helm of the freeport agenda. This emphasises just how important it is to reflect on the political dynamics of such projects and their real-world impact at the local level.


Teesside’s Technopopulist Present

Chris Bickerton and Carlos Invernezzi-Accetti offer one way of conceptualising the new adaptive political logic on display in places like Teesside: technopopulism. No longer structured by the political competition of traditional left-right political divides, politicians competing for office in today’s modern democracies claim to represent both the people and the experts who claim to translate the people’s needs and wants into policy. Populism and technocracy have therefore, become the main structuring poles of contemporary democratic politics, and these poles have not only merged but also narrowed the horizon of possibilities and political imagination. Bereft of substantive ideas, technopopulists intend only to fob off the people’s needs by doing what already exists in more cost-effective ways.

Ben Houchen, the elected Mayor of the Tees Valley and Chair of the TVCA, embodies this new logic. He combines both technocratic and populist appeal, sitting on the initial government Freeport Advisory Panel while simultaneously selling the populist dream of taking back control to his electorate. Allegedly, “devolved power” in England has seen people like Houchen take a leading role in regenerating local areas, often in public/private partnerships with local businesses. He is the local lad, former business owner and solicitor who promises to regenerate the area where he grew up and create lots of high-skilled jobs. His promises include creating 20,000 jobs in a new green energy centre based on one of Europe’s largest and most contaminated brownfield sites.

In reality, he seems to be enacting the same neoliberal agenda that destroyed Teesside in the late 20th century. In the space of one year, the global economic order supported by elite actors has encouraged forms of disordered local activity that are killing off industry and ecosystems. Alongside the land grabs, asset stripping and environmental harms reported to date, asset management companies based in faraway places are investing heavily leveraged capital to seize the rentier opportunities presented by state-backed infrastructural renewal. As Brett Christopher’s recent work captures so well, in terms of investment, Teesworks is a classic example of an asset requiring substantive renovation or upgrading and, therefore is only attractive to a specific type of investor, to whom local politicians and business elites have to pander to secure buy-in. The result on Teesside is that Houchen has sold off a 90-per-cent stake to the locally based JC Musgrave Capital, who manage leveraged funds from foreign investors and asset management conglomerates. Hardly a story of taking back control on behalf of local people.

However, it would be too easy to simply criticise Houchen or label his supporters as misguided. The broader and deeper question is what sort of alternative vision is missing for local people in areas cast aside by decades of mismanagement in the face of unforgiving global market forces? And what might we do to challenge the interests of global investors most politicians are forced to work with? To borrow once more from Bickerton and Invernezzi-Accetti, the only way we can understand politics is if we understand what the struggle is about. My current research shows how the people of Teesside, including many Houchen voters, are left feeling even more disillusioned and angry about the lack of transparency, representation and economic ambition in British politics. Resentment rumbling under the surface could begin to break through in as yet unknown political forms. Ultimately, how to introduce democracy in the governance of freeports and SEZs in a way that benefits working people without damaging the environment is now an important political issue.


Alexandra Hall is an Associate Professor in the Department of Social Sciences at Northumbria University, Newcastle. Her current project, funded by an Independent Social Research Foundation Early Career Fellowship, is an interdisciplinary study of the political and criminogenic dimensions of the UK’s new freeports.




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