Deal or no deal, we must never again leave British trade hostage to the Channel choke point

By Ambrose Evens-Pritchard Aug 21 2019 / The Telegraph

Dover port
Over-reliance on Dover road freight may have made financial sense – at the margin – when there was a surplus of East European hauliers willing to work long hours at low pay

Britain’s trade transport system is no longer fit for purpose. Today’s deformed structure amounts to a failure of statecraft over decades and – as we are discovering – is a potential threat to economic national security. 

Goods from Germany’s Ruhr Valley or the manufacturing clusters of Baden-Württemberg are transported in lorries to the Channel and from there to Leeds, Doncaster, Sheffield, or Manchester in the UK’s industrial heartland.  

Shipments of Scottish whisky are trucked in the opposite direction down the length of this island to Dover and on to markets in Europe. The time saved is mostly insignificant for non-perishable goods. The just-in-time mantra is often overstated. For some destinations it may even take slightly longer in any case.  

Reliance on trucks and drivers greatly increases the danger of a logistical debacle if Britain is compelled to leave the EU without a deal – that is to say if Brussels continues to insist on indefinite EU control over swathes of UK law, with no unilateral exit mechanism.  

The problem mushrooms once human beings are involved. There is an extra layer of paperwork. “It is easier to ship a container than process a truck. You pre-clear customs. It is just a click,” said Simon Bird, director of the Humber region for Associated British Ports (ABP).  

The concentration funnel at Dover is narrow and prone to delays even in normal times. The risks were already evident in 2015 when a four-day strike by French ferry workers caused a 17-mile lorry jam up the M20 and cost £250m a day. A variant of this happened again the following year.

The crossing is vulnerable to political manipulation. If Emmanuel Macron wishes to cause long delays on the British side of the French Channel ports – to embarrass us, or to make a political point – he has the means to do so. No sovereign country can tolerate such a vulnerability.

Over-reliance on Dover road freight may have made financial sense – at the margin – when there was a surplus of East European hauliers willing to work long hours at low pay. Cheap labour is one reason why the share of UK-EU trade through Dover has jumped from 14pc to almost a third since the early 1990s. 

Immingham
Immingham on the Humber is Britain’s biggest port and strategically safer than Dover
 

That era of abundance is over. Wages are soaring in the old Warsaw Pact countries as their economies catch up. Hauliers say there is a shortage of 60,000 drivers in Britain. Median hourly rates for heavy goods transport last year rose 5.4pc. The EU’s mobility directive – targeted against Polish and Bulgarian drivers – will raise costs further.

Road shipments on the current saturation scale through Kent, around the M25, and up the arterial routes of the Midlands occur only because the incentive structure is warped. It does not fully “price” the economic and social cost of congestion, noise, diesel pollution, C02 emissions, road erosion or the 15pc of fatal accidents involving lorries. 

The ecological footprint of competing sea routes to ports on the Humber or Teeside is lower, and will be lower still under the world’s new marine shipping rules. They are safer. 

A study by the University of Hull Logistics Institute for ABP found that switching from Dover to the Humber ports to destinations in the UK’s “central east-west corridor” added just three hours to an average 34-hour journey time. This was averaged over routes from Frankfurt, Munich, Hanover, Paris, Milan, and Warsaw.

It would add three and a half hours to the Manchester-Frankfurt route (based on ships speeds of 17 knots), but lower carbon emissions by a quarter. Average emissions for lorries is 0.083 kg of CO2 per tonne per kilometre, compared to 0.03 kg for containers. 

Regardless of the environmental imperatives of Net-Zero 2050, the Brexit debate has exposed this country’s over-reliance on a single strategic choke-point. Successive governments have been careless. 

 Brexit “notifications” issued by Brussels say UK goods will be deemed incompatible with EU regulations on November 1 even before any divergence could possibly have occurred, in breach of WTO principles, and therefore subject to checks that could lead to jams.

But this draconian guidance from the EU’s Task Force 50 does not fix exactly what would happen in Dover. Each member state has some latitude over how to enforce customs clearance from day one.

French officials, under orders from Paris, are threatening a maximalist interpretation rather than a “risk-based” approach on the basis of common sense. This would guarantee jams. Dutch and Belgian officials seem less inclined to treat Brexit as a punishment exercise. Ergo, switch to them wherever possible. 

French ports chief Jean-Marc Puissesseau protests that there is nothing to fear in Calais. He accuses UK vested interests of whipping up “catastrophism” and insists that freight flows will be fluid even after a no-deal. He may be right on technical grounds, but political threats remain. 

https://www.telegraph.co.uk/business/2019/08/21/deal-no-deal-must-never-leave-british-trade-hostage-channel/


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