Who will follow in the wake of Asda?

by Julia Breen

The world's largest retailer announced yesterday that it had decided to build a £20m import centre at Teesport, favouring the North over crowded Southern ports. Business Editor Julia Breen looks at the impact this will have on Teesport's campaign to bring 7,000 jobs to the region

It was exactly the boost the Teesport campaign had been waiting for.

Yesterday morning Asda, part of retailer Walmart, announced it was opening an import centre on the Tees, creating hundreds of jobs.

In a few months, millions of clothes, televisions, CDs and other non-food goods will be arriving on Teesside, destined for Asda supermarkets all over the UK.

Asda said the presence of such a large warehouse in the North would save the company two million miles on UK roads a year as distribution distances to stores around the country were dramatically reduced.

At present, the bulk of Asda's imported products are shipped to ports in the South, such as Felixstowe and Southampton.

Once the Teesport centre is operational, 70 per cent of its non-food goods will be unloaded on the Tees.

Asda is the first to recognise that it can help free-up congested Southern ports - and the UK's roads - by shipping goods from the Far East straight into the North, rather than unloading in the South and then transporting it around the UK.

However, other retailers, one of which is rumoured to be B&Q, may be about to follow suit, helping Teesport to catch the eye of major deep-sea shipping lines, increasing the demand for another deep-sea container terminal on the Tees.

Tony Page, non-food director at Asda said yesterday: ''This is great news for the economy in the North-East. Not only are we creating 300 jobs, but we are also paving the way for other retailers to follow our lead.

''The facility will also enable us to dramatically reduce our impact on the environment. We will save two million road miles a year - equivalent to five trips to the moon.'' FOR six months, Teesport owners PD Ports and The Northern Echo have been campaigning for the Government to halt further expansion of Southern ports, and instead allow investment and expansion in the North.

Government ministers, who are about to decide whether to give planning permission for two container ports in the South-East, are being urged to delay the decision to take into account the case for Teesport.

Teesport wants to invest £300m in another deep-sea container terminal, which would allow more companies like Asda to ship goods directly from the Far East. It has been estimated that such an expansion could create 7,000 jobs.

PD Ports group development director Martyn Pellew said that if the Government gave permission for the two Suffolk ports, Felixstowe and Harwich, to expand, rather than Teesport, that would go against the Northern Way - the Government growth strategy to bridge the multibillion pound North-South economic divide.

If the Suffolk ports' plans are approved, Teesport will not be able to expand, as there will be insufficient demand for the extra capacity.

PD Ports is in the process of applying for Government permission to expand. If approval is given, the new terminal will open in 2009.

Mr Pellew is at the Labour Party conference in Brighton this week to encourage government support for Teesport's plans.

He said: "It is good timing that Asda has made the announcement this week.

"I have always said that, if the Government does allow expansion in the South, over that in the North, it will have fallen at the first hurdle of the Northern Way strategy."

Last week, the North-East Process Industry Cluster (Nepic), which represents chemical and pharmaceutical companies in the region, said that if the port did not expand, the process industries - which underpin about 34,000 jobs in the region - would also stagnate.

Nepic chief executive Stan Higgins said the chemical industry's fortunes were closely linked with those of the port.

And on Friday, the region's 25 local authorities pledged their support for PD Ports' plans. Mick Henry, chairman of the Association of North East Councils, said: "We very much support the campaign being run by The Northern Echo, which will benefit the whole region."

28/09/05