Trade minister Ivan McKee said today that Scotland will adopt a new model of "green ports" with a particular focus on inclusive growth, fair work practices and delivering a net zero economy.
But the move was branded a "screeching u-turn" by opposition parties after previous criticism from the Scottish Government of the Freeport system.
The minister insisted the Scottish approach would adapt the UK government’s freeport proposals, with streamlined planning processes and a package of tax and customs reliefs.
“The reputation of freeports across the world is mixed, with concerns about deregulation and risks of criminality, tax evasion and reductions in workers’ rights raised," Mr McKee told MSPs at Holyrood today.
"That is not a model nor an approach that this Scottish Government will sign up to or allow here in Scotland.
“And it is clear that freeports cannot and will not undo the damage being caused to Scotland’s economy by the UK Government’s decision to take us out of the EU, the world’s biggest single market.
“Instead, we propose to take the freeport model and apply Scotland’s priorities to it, so that it meets our ambition to deliver a net zero, wellbeing economy that upholds the highest standards of environmental protections and fair work practices and supports our strategy of building clusters of high productivity businesses across Scotland’s regions."
Applications to become one of the new Scottish “green ports” will open in March, with the incoming Scottish Government, after the Holyrood election in May, then taking deciding which bids are successful. Rosyth, Dundee and Tayside, Hunterston, and Ross and Cromarty are likely to be among the areas in contention.
Freeports are usually marine ports where normal tax and customs rules do not apply. Imports can enter with simplified customs documentation and without paying tariffs. Businesses operating inside designated areas in and around the port can then manufacture goods using the imports and add value, before exporting again without ever facing the full tariffs or procedures.
Mr McKee insisted that any free operator in Scotland under the model set out today must pay the real Living Wage and sign up to the Scottish Business Pledge, as well as committing to supporting sustainable growth and contributing to Scotland’s transition to net zero carbon emissions.
But Tory economy spokesman Maurice Golden said: “This is a humiliating climb-down for the SNP. Just a few months ago, Ivan McKee was claiming that freeports are a “shiny squirrel” and the SNP conference backed a motion slamming them.
“This screeching SNP u-turn is very welcome. It seems they have finally realised that businesses are desperate to reap the benefits from freeports.
“The Scottish Conservatives and UK Government have said for months that the SNP should stop playing politics and start working constructively to take these proposals forward.
“Yet again, the SNP treated business as an afterthought. They ignored the benefits to make political points and only now have they finally backed down.”