As the last British-owned port is sold abroad...
What kind of nation sells its soul to the highest foreign bidder?
What kind of nation sells its soul to the highest foreign bidder?
By Alex Brummer, Daily Mail. 23rd March 2011
As a great maritime and trading nation, Britain ought to treasure the ports that have been built up over centuries around our shores. Yet despite their vital importance to our economic and military security, barely a murmur of protest has been heard as the great publicly-quoted companies that own them have been sold to foreign-based firms one by one.
Yesterday, Forth Ports — the last remaining British port owner to be listed on the stock exchange — was sold for £754million to an assortment of financial groups (with the help of Germany’s Deutsche Bank) led by a little-known European investment firm. The new company now has control of London’s Tilbury Docks, several Scottish ports and 400 acres of Edinburgh waterfront.
At a time when other maritime nations, such as China and the United Arab Emirates, are jealously guarding their own trading hubs and snapping up ports across the world — from Sri Lanka to Africa — Britain has effectively sold off the nation’s family silver.
The great pity is that politicians of all parties have scandalously allowed this steady erosion of our dominant role in international trade.
The tragedy is that ports have played a critical economic role in Britain since the 12th century, when a royal charter established the Cinque ports of Hastings, New Romney, Hythe, Dover and Sandwich to maintain ships for the Crown in case of need. In return, the five ports were granted exemption from taxes and tolls.
The idea was so successful that it spread from the South-East to Liverpool, Bristol and London as overseas trade stepped up. The nation’s maritime exploits, symbolised by the adventurism of men such as Sir Francis Drake and Sir Walter Raleigh, became the stuff of Elizabethan legend as the UK established itself as the world’s greatest seafaring nation.
Now there appears to be a pathetic acceptance that the identity of those who own our ports does not matter.
But the truth is that the ownership of these keystones of the British Isles is absolutely vital. As a traditional trading nation dependent on imports of gas and oil for so much of our energy needs, the control of our ports — as well as access to strategic ports overseas — is crucial.
Yet when foreign companies buy parts of this country’s infrastructure, decisions about their future are no longer taken in the interests of the British public. Once our ports are sold into foreign hands they are run by faceless corporations with overseas headquarters. Jobs are lost in the name of cost-cutting and the Treasury loses millions in corporation tax as the firms relocate their head offices to low-tax countries such as Switzerland.
The great sell-off of our ports started five years ago when buyers, including the investment bank Goldman Sachs, bought ownership of Associated British Ports (ABP) for £2.8billion. ABP was a jewel in the crown of Britain’s domestic transport and freight industry. It owned 21 ports around the coast of the UK, including the massive container and passenger docks at Southampton, as well as those at other maritime centres such as Plymouth, Hull and Cardiff.
But the biggest loss came in 2006, when P&O Ports (which had been carefully built up by one of Mrs Thatcher’s favourite businessmen, Lord Sterling) was sold to Dubai Ports World in a deal worth £3.3billion after 168 years as a British firm.
As well as a network of key UK ports, P&O had built up one of the most enviable collections of ports around the world. It controlled docks and freight traffic from the Eastern Seaboard of the United States to China. This gave Britain a major influence in international trade.
P&O ships carried more of China’s trade goods than any other company. Given the incredible growth of the Chinese economy since P&O was sold to a Dubai company, if Britain had retained control of the firm, we would have had a vitally important foothold in the world’s largest marketplace.
But short-sightedness by the get-rich-quick merchants in the City has left the UK with no presence in a market that it once dominated. Much of this nation’s imports and exports — from cars to raw materials — pass through our ports, which are connected by rail terminals and haulage operations.
Income is generated by container and terminal handling fees, shipping agencies, dredging and marine consultancy. As well, there are the financial services, such as insurance, which go hand-in-glove with logistic networks.
That’s why the ports play a crucial part in the country’s financial businesses. The goods being transported are often insured by London-based companies and, more often than not, traders protect themselves in the City against any change in the value of their goods due to movement of currencies or the stock markets using City-based firms.
All these subsidiary businesses add to the nation’s productivity and, in a world of increasing international trade, provide a rising stream of income. Sadly, the British people’s best strategic, commercial or economic interests are of no consequence to the foreign firms that are trying to buy up the remaining parts of this country’s heritage.
How significant that while the Labour government weakly let the vast network of P&O ports fall into Middle Eastern hands, the U.S. refused to allow its ports be bought by a foreign firm. Following a revolt by Senators, the Washington administration insisted that P&O’s American ports should remain in U.S. hands and be put into the trust of American investors. If only British politicians had the same foresight and sense of national pride.
But then, such wanton national vandalism of Britain’s core interests is of a kind with what’s happened elsewhere in this country in recent years. In the decade before the great financial panic of 2008 — when credit was free and easy — key assets that most other countries would have protected as strategically important were left open to foreign invaders.
Our main airports were sold to the Spanish group Ferrovial, which proceeded to skimp on basic investment such as buying snow-clearing equipment. As a result, our airports were unable to cope with heavy snowfalls last December and most had to be closed. The after-effects severely damaged the economy.
Similarly, we have ceded control of four out of six of our biggest energy companies to overseas giants — meaning we no longer have ultimate control of our energy supplies. Thus, when Russian gas supplies were disrupted two years ago because of a dispute between Moscow and the Ukraine, gas that was supposed to be piped to Britain was diverted to the German market.
The Government has also handed control of Britain’s next generation of nuclear power stations to the French state-controlled power giant Electricite de France (EDF). Naturally, its Paris bosses will award most of the multi-billion construction contracts for new power stations to their own countrymen, while British firms are left with minor sub-contracting roles.
All of this places Britain at a huge disadvantage as it seeks to re-balance its economy away from finance and back towards manufacturing, innovation and our traditional skills. The truth is that it takes centuries to build assets such as ports and other infrastructure networks, and now it seems we have lost them for good.
As China expands into traditional UK colonial commercial hubs in Sri Lanka and Nigeria, all we can do is look on with bitter regret that we no longer have any control over those regions and the valuable shipping lanes that connect them.
Other countries, including Germany and France, recognised long ago that certain key national assets such as power and transport hubs are strategic and important for a nation’s long-term growth, and have made great efforts to protect them.
What an indictment of modern Britain that at a time when we are struggling to pull out of recession, we have sold off the last remnants of our maritime traditions to the highest foreign bidder.
Yesterday, Forth Ports — the last remaining British port owner to be listed on the stock exchange — was sold for £754million to an assortment of financial groups (with the help of Germany’s Deutsche Bank) led by a little-known European investment firm. The new company now has control of London’s Tilbury Docks, several Scottish ports and 400 acres of Edinburgh waterfront.
At a time when other maritime nations, such as China and the United Arab Emirates, are jealously guarding their own trading hubs and snapping up ports across the world — from Sri Lanka to Africa — Britain has effectively sold off the nation’s family silver.
The great pity is that politicians of all parties have scandalously allowed this steady erosion of our dominant role in international trade.
The tragedy is that ports have played a critical economic role in Britain since the 12th century, when a royal charter established the Cinque ports of Hastings, New Romney, Hythe, Dover and Sandwich to maintain ships for the Crown in case of need. In return, the five ports were granted exemption from taxes and tolls.
The idea was so successful that it spread from the South-East to Liverpool, Bristol and London as overseas trade stepped up. The nation’s maritime exploits, symbolised by the adventurism of men such as Sir Francis Drake and Sir Walter Raleigh, became the stuff of Elizabethan legend as the UK established itself as the world’s greatest seafaring nation.
Now there appears to be a pathetic acceptance that the identity of those who own our ports does not matter.
But the truth is that the ownership of these keystones of the British Isles is absolutely vital. As a traditional trading nation dependent on imports of gas and oil for so much of our energy needs, the control of our ports — as well as access to strategic ports overseas — is crucial.
Yet when foreign companies buy parts of this country’s infrastructure, decisions about their future are no longer taken in the interests of the British public. Once our ports are sold into foreign hands they are run by faceless corporations with overseas headquarters. Jobs are lost in the name of cost-cutting and the Treasury loses millions in corporation tax as the firms relocate their head offices to low-tax countries such as Switzerland.
The great sell-off of our ports started five years ago when buyers, including the investment bank Goldman Sachs, bought ownership of Associated British Ports (ABP) for £2.8billion. ABP was a jewel in the crown of Britain’s domestic transport and freight industry. It owned 21 ports around the coast of the UK, including the massive container and passenger docks at Southampton, as well as those at other maritime centres such as Plymouth, Hull and Cardiff.
But the biggest loss came in 2006, when P&O Ports (which had been carefully built up by one of Mrs Thatcher’s favourite businessmen, Lord Sterling) was sold to Dubai Ports World in a deal worth £3.3billion after 168 years as a British firm.
As well as a network of key UK ports, P&O had built up one of the most enviable collections of ports around the world. It controlled docks and freight traffic from the Eastern Seaboard of the United States to China. This gave Britain a major influence in international trade.
P&O ships carried more of China’s trade goods than any other company. Given the incredible growth of the Chinese economy since P&O was sold to a Dubai company, if Britain had retained control of the firm, we would have had a vitally important foothold in the world’s largest marketplace.
But short-sightedness by the get-rich-quick merchants in the City has left the UK with no presence in a market that it once dominated. Much of this nation’s imports and exports — from cars to raw materials — pass through our ports, which are connected by rail terminals and haulage operations.
Income is generated by container and terminal handling fees, shipping agencies, dredging and marine consultancy. As well, there are the financial services, such as insurance, which go hand-in-glove with logistic networks.
That’s why the ports play a crucial part in the country’s financial businesses. The goods being transported are often insured by London-based companies and, more often than not, traders protect themselves in the City against any change in the value of their goods due to movement of currencies or the stock markets using City-based firms.
All these subsidiary businesses add to the nation’s productivity and, in a world of increasing international trade, provide a rising stream of income. Sadly, the British people’s best strategic, commercial or economic interests are of no consequence to the foreign firms that are trying to buy up the remaining parts of this country’s heritage.
How significant that while the Labour government weakly let the vast network of P&O ports fall into Middle Eastern hands, the U.S. refused to allow its ports be bought by a foreign firm. Following a revolt by Senators, the Washington administration insisted that P&O’s American ports should remain in U.S. hands and be put into the trust of American investors. If only British politicians had the same foresight and sense of national pride.
But then, such wanton national vandalism of Britain’s core interests is of a kind with what’s happened elsewhere in this country in recent years. In the decade before the great financial panic of 2008 — when credit was free and easy — key assets that most other countries would have protected as strategically important were left open to foreign invaders.
Our main airports were sold to the Spanish group Ferrovial, which proceeded to skimp on basic investment such as buying snow-clearing equipment. As a result, our airports were unable to cope with heavy snowfalls last December and most had to be closed. The after-effects severely damaged the economy.
Similarly, we have ceded control of four out of six of our biggest energy companies to overseas giants — meaning we no longer have ultimate control of our energy supplies. Thus, when Russian gas supplies were disrupted two years ago because of a dispute between Moscow and the Ukraine, gas that was supposed to be piped to Britain was diverted to the German market.
The Government has also handed control of Britain’s next generation of nuclear power stations to the French state-controlled power giant Electricite de France (EDF). Naturally, its Paris bosses will award most of the multi-billion construction contracts for new power stations to their own countrymen, while British firms are left with minor sub-contracting roles.
All of this places Britain at a huge disadvantage as it seeks to re-balance its economy away from finance and back towards manufacturing, innovation and our traditional skills. The truth is that it takes centuries to build assets such as ports and other infrastructure networks, and now it seems we have lost them for good.
As China expands into traditional UK colonial commercial hubs in Sri Lanka and Nigeria, all we can do is look on with bitter regret that we no longer have any control over those regions and the valuable shipping lanes that connect them.
Other countries, including Germany and France, recognised long ago that certain key national assets such as power and transport hubs are strategic and important for a nation’s long-term growth, and have made great efforts to protect them.
What an indictment of modern Britain that at a time when we are struggling to pull out of recession, we have sold off the last remnants of our maritime traditions to the highest foreign bidder.
