Mr. Barry O'Connell:

Good morning everyone. I am not sure to what extent the committee is familiar with Dublin Port so I will take a few minutes to give members some broader context before I get into addressing the specific question regarding Brexit.

Dublin Port Company is a State-owned, commercial semi-State company responsible for operating and developing Dublin Port. It is the largest freight and passenger port in Ireland and is one of five major ports classified as tier 1 and tier 2 ports in the national ports policy. Dublin Port is also categorised as a core-comprehensive port in the EU's TEN-T framework. Of the volumes which passed through Dublin Port in 2022, 40% were exports and 60% were imports, with some of these imports being raw materials that would eventually become exports. It is estimated that the value of exports is approximately three and a half times greater than imports. This implies that Dublin Port is not only an important hub for domestic trade but also a central pillar of Ireland’s export strategy. The port handles almost 50% of all mercantile trade in the Republic of Ireland, with its share of volume driven by three key factors. The first is the location of the port relative to the main population centre of Dublin city. Second is the depth of water at the port, which enables larger vessels to berth, and the third is access to the national road and rail infrastructure. The port is located in the heart of Dublin city and the hub of the national road and rail network. It is a key strategic access point for Ireland and the Dublin area. A recent origin and destination study indicated that 73% of port volumes had an origin or destination within 90 km of Dublin Port. Shortening this radius, the survey showed that 61% of volume had an origin or destination within 40 km of Dublin Port. Dublin Port is therefore inextricably linked with the national road infrastructure which supports it and offers a very cost-effective and efficient way of transporting imports and exports.

In understanding the impact of Brexit on Dublin Port and trade volumes between Ireland, Britain and Europe, it may be helpful if I outline the main modes of shipping traffic and freight that come in and out of Dublin Port. The majority of freight handled at Dublin Port is unitised, for example, those big 40 ft containers we all see. In gross tonnage terms, this accounts for 81% of trade at the port. This includes ro-ro freight and load on lo-lo freight. Ro-ro freight can involve driver-accompanied or driver-unaccompanied freight, which will be an important point as I go on to explain the impact of Brexit. Lo-lo freight is moved in an unaccompanied mode, with containers stored at the port and then collected from depots by heavy goods vehicles, HGVs, or by rail. The balance of trade at the port includes bulk liquid, bulk solid and break bulk, as well as trade vehicles and passenger traffic.

In examining the impact of Brexit on overall trade flows in Dublin Port, it is difficult to isolate the effects of Covid-19 and, of late, the war in Ukraine. It is our contention that the single most significant influence on volumes since 2019 has been Covid-19. In terms of trading volumes, 2019 was a record year for the port, so we tend to use this as a reference point. When considering volume trends within the port, we know from history that there is a strong correlation with overall economic performance and, more specifically, the personal consumption index, PCI. PCI declined by nearly 12% during lockdown in 2020, while port volumes declined by 3.4%. This was also the year during which the main Brexit changes happened. There was no material disruption to port business at that time, which is why we contend that the main impact on demand and overall volumes was driven by Covid-19.

As economies began to open up towards the end of 2021, PCI began to grow and port volumes also began to recover to the extent that, at year-end 2022, unitised volumes were only 2.2% behind the record 2019 numbers.

If the stockpiling that happened at the end of 2019 in anticipation of Brexit is discounted, it is fair to say by the end of 2022 Dublin Port was back to its record 2019 numbers. Passenger and tourist vehicle volumes are also returning to pre-Brexit, levels, although once again the major impact on tourists and seaborne visitors was more likely due to Covid than Brexit. As an aside, despite recessions, pandemics and international challenges, Dublin Port volumes have remained remarkably resilient over the past three decades. Compound average growth has been running at 5% per annum since 1990.

While Brexit may not have been the key driver of volume reduction in the 2020-21 period, there was some loss of volume to Northern Ireland ports. Their share of ro-ro increased from 41% in 2020 to 45% in 2021. It is our belief that this was as a result of a settling-in period during which operators were adjusting to the new restrictions north and south of the Border. By the end of 2022, the Northern Ireland ports' share had fallen back to 42%, which indicates a more settled position. Dublin Port shares recovered from 46% in 2021 to 48% in 2022, while driving growth of 4% in an overall flat market. By contrast, the Northern Ireland ports' share fell by 5%. It is also worth noting, as Mr. Carr alluded to, that Rosslare’s share of ro-ro over the same period grew from 6% to 9%.

While Brexit may not have had a material impact on volumes since 2019 it has had a significant impact on the international origin and destination of freight, as well as the modes of transport deployed. Volumes on direct European ro-ro services for 2022 increased by 64.4% on the equivalent period for 2019. Increases were most notable on routes to Zeebrugge, Rotterdam, Cherbourg, Santander and Emden. Correspondingly, the ro-ro volumes with UK ports declined by 17.8%. There was a modest increase in lo-lo traffic from EU routes. It went from 29% of mix in 2019 to 31% of mix in 2022. However, the main shift in mode came in the form of driver-unaccompanied ro-ro freight, which grew from 47% to 51% of our mix. Due to the way it operates, this places additional pressure on the port’s capacity as it requires the units to be stored on site until collected for distribution. This is unlike traditional ro-ro, which goes straight through the port. Additional land is required.

Perhaps the most significant impact of Brexit as it applies to Dublin Port is the impact on land usage on the port estate itself. In advance of Brexit, the State authorities established a number of facilities in the port to manage new inspection requirements arising from Brexit. This involved Dublin Port Company allocating 14.6 ha of land to the Office of Public Works for these purposes. In addition, Dublin Port Company invested approximately €30 million in facilities directly associated with Brexit requirements. Notwithstanding the fact no one knew exactly what would happen in the lead up to Brexit, and that the transition was handled without any material impact, at least within the port, it is our view it is now time to reassess land usage and processes to balance the requirement of State services with the pressing needs of Dublin Port for capacity and the terminal operators and hauliers for efficiency. To put the land usage issue into context, the 14.6 ha of land allocated for Brexit is equivalent to approximately 300,000 ro-ro units, or 19% of our current throughput.

On efficiency, we believe digitisation of customs, regulatory and transit records has a key role to play in the port to facilitate a much smoother and faster transition of freight. Such a system is in operation in the UK, where 106 ports that account for 85% of all unitised maritime trade operate on a system that handles all data transfers between operators and government agencies. Digitisation is very much at the early stages of investigation. However, it should be pursued as a means of maintaining our competitiveness.

This statement outlines the key dynamics that we believe have arisen during the Brexit transition for Dublin Port. That is not to understate the impact Brexit may have had on other stakeholders, including the hauliers, whom I believe the committee will hear from later. Dublin Port will continue to be impacted by global events. However, the port has shown remarkable resilience over many years and we are intent on ensuring we fulfil our obligations to the State in enabling the free movement of trade with the UK and our European partners.