Like it or loathe it, DP World’s £1bn investment is vital to UK shipping
Whichever way you look at it, this weekend’s events were painfully awkward.
On the one hand, you have a new government making a massive blunder ahead of its key investment summit, seemingly putting at risk £1bn in investment into one of the biggest ports in the UK.
That investment has now been secured, but at the cost of Keir Starmer publicly rebuking one of his own cabinet and seemingly bowing to the whim of the Dubai-based owner of P&O Ferries, DP World.
Yes, that’s the same P&O Ferries that laid off 800 of its workers in an infamous fire and rehire scandal in 2022. Many are now employed on a meagre £5.20 per hour salary, significantly less than the minimum wage.
The fact that Starmer was willing to denounce Louise Haigh, his transport secretary, who referred to P&O as a “rogue operator”, and risk accusations of being held ransom by DP World, is an indication of how critical this investment is for the UK’s maritime industry.
The money will go into expanding London Gateway, the port on the north bank of the River Thames to the east of the capital, in which more than a quarter of the UK’s deep sea shipping cargo travels.
The hub is in the midst of a bust-up with rival Felixstowe to become the UK’s largest port, and it has been seeking to significantly grow capacity in recent years. It currently has annual capacity for around 3m TEU, TEU being the industry measure of volume in units of twenty-foot long containers, but the recent installment of a fourth berth could see that increase by over a third.
It is not just about container capacity either. London Gateway is home to the largest port-adjacent logistics park in Britain and it is aiming to make it the largest in Europe. That would mean expanding its already-gigantic warehousing facilities, which store anything from foods, consumer goods, and even plays host to a banana ripening facility.
Losing the £1bn would derail London Gateway’s plans at a time when UK shipping is in need of more capacity and infrastructure investment into its ports.
Shipping executives descended on London last week for the annual Shipping UK conference.
Speaking to City PM at the time, Rhett Hatcher, CEO of the Chamber of Shipping, was at pains to stress the success of London’s shipping scene in recent years, describing it as a “very positive” story, one which should be continued.
Also speaking at the event was under-fire Transport Secretary Louise Haigh, who vowed to put the UK’s maritime industry first: “The national renewal we promised all depend on the people in this room. Economic growth rests on maritime growth,” she said.
“I will place maritime at the heart of this government’s bold plans for change… That means more shipping not less.”
Like it or loathe it, DP World’s investment will be vital to delivering this vision. It’s just a shame it has come at a price.