UK should look to CEE for logistics opportunities

Perhaps under investigated, however, is the fact that this is a pan-European opportunity with central and Eastern Europe (CEE) particularly ripe for growth.

Investment into CEE exceeded €13.1bn (£11.6bn) in 2017 and heightened competition for strong-performing distribution centres has led it to become a leader for logistics, as operators look to enhance their economies of scale and quality of premises. This growth has trickled specifically into CEE e-tailing, particularly with the EU’s digital single-market strategy removing barriers to online trade between member states.

No doubt investment in dynamic technologies such as robotics and data analytics are helping the region on its way. Amazon, a pioneer in the use of mobile robots in its warehouses, has just opened its fifth logistics centre in Poland and plans to build two more – surely a nod to CEE as a hub of growth and innovation.  

By contrast, the UK’s construction sector is in limbo awaiting Brexit. While we should be cautiously optimistic about the UK’s outlook, if the industry is to continue thriving and capitalise on the logistics sector’s growth – particularly in CEE – we need to be able to match the incentives drawing investment into the region’s logistics sector.

Increasing the UK’s annual investment allowance to £1m for two years, as was announced in the Budget, in order to kick start business investment in the UK, in areas such as logistics, to boost innovation and creativity and dampen the effect of Brexit is undoubtedly a good start.

But following the right strategy to harness growth in areas such as CEE and beyond – the remit of a post-Brexit Global Britain – and offering an attractive package of incentives and tax allowances to match or better those of rival countries, will be key to ensuring the UK enhances its role in the logistics sector – come what may with Brexit.

John Harcourt, head of property at Kajima