Scotland's Economy

Look back on Scotland’s economy, 2017

December 28, 2017 by donnawatson No Comments | Category Uncategorized

Keith Brown, Cabinet Secretary for the Economy, Jobs and Fair Work

Despite the uncertainty caused by Brexit, the Scottish economy has strengthened in 2017. The economy has grown and our labour market has performed strongly with the unemployment rate falling to a record low level and the number of people in employment reaching a record high of 2.67 million in May – July.

I started the year by announcing our increased support for Scotland’s network of cities, progressing City Region Deals to boost jobs, infrastructure and the economy in Edinburgh, Dundee, Perth and Stirling, as well as the £760 million being invested over the next 10-20 years in Glasgow, Aberdeen and Inverness through City Region Deals. Regional partners estimate that the Glasgow and Aberdeen deals alone will deliver more than 32,000 jobs.

Our London hub at Scotland House opened to bring together and support Scottish firms doing business in London, and provide a base for those working with our enterprise and tourism agencies. This followed the opening of the first Innovation and Investment Hub in Dublin in 2016, and we now look forward to the opening of our Berlin hub in 2018.

In March, I travelled to Germany to set the ground for this facility and was able to see the very real and exciting opportunities there for Scottish businesses.

I also visited the US and Canada this year to promote Scottish business and strengthen our diplomatic ties.

The 2017 EY Scotland Attractiveness Survey showed that Scotland had retained its position as the top location in the UK outside London for foreign direct investment.

Of course, conscious of the ongoing uncertainty caused by Brexit, there has never been a more important time for us to cultivate our relationships with our friends in Europe and beyond. Scottish jobs, and the sustainability of our economy, rely on it.

At home, we were able to help save BiFab and the jobs which were under threat, and we celebrated the launch of the MV Glen Sannox – the UK’s first liquefied natural gas (LNG) passenger ferry – from the saved Fergusons shipyard.

Our Enterprise and Skills agencies, under the guidance of our new Strategic Board, and our Trade Envoys are now starting to link up Scottish businesses with the expertise they need to improve their skills bases and their connections in both the domestic and overseas markets.

Infrastructure projects worth almost £6.4 billion have been under construction throughout Scotland in 2017. It goes without saying the massive contribution this makes to our economy in terms of jobs, investment and connectivity. A very visible connection took the spotlight in September when we opened the Queensferry Crossing – the longest three-tower, cable-stayed bridge in the world. And at almost £250million under budget. Over 15,000 people worked on the construction site since 2011, clocking up over 18 million hours of work in the process. Thousands more have been indirectly employed and have benefited through the project’s supply chain. Scottish firms have been awarded sub-contracts or supply orders on the project with a total value of over £350 million.

In October the Scottish Government held an international conference on inclusive growth, which gathered international organizations such as the OECD and IMF, as well as representatives from governments across the world, at the University of Glasgow. We were able to use this opportunity not only to showcase the work being done to promote inclusive growth here in Scotland but also learn from the diverse range of approaches being applied in Sweden, Costa Rica, New Zealand and others.

At the start of December, we announced the location of the new National Manufacturing Institute for Scotland. This £65million ‘Factory for the Future’ will be built on the banks of the Clyde and will benefit the whole of Scotland.

Later in December, we reported that spending on business research and development in Scotland increased by 10% in 2016 (three times the UK growth rate) and topped £1 billion for the first time ever.

Our Programme for Government and Budget have a very firm focus on innovation and economic growth, including commitments to deliver the most attractive business rates package in the UK, £600m for our “Reaching 100%” broadband programme, £756 million towards delivery of more than 50,000 affordable homes; a new, fairer, income tax policy that will mean 70% of taxpayers paying less in income tax next year; establishing a £150 million Building Scotland Fund and setting aside resources of £340 million to provide initial capitalisation for the Scottish National Investment Bank; and an ambitious programme of infrastructure investment for 2018-19 of more than £4 billion.

The growth package will see spending on the economy increase by 64% – an increase of £270 million  – in 2018-19. That’s now more than £100-per-head higher than the UK Government, to provide stability in the wake of Brexit uncertainty and UK Government austerity.

However, our position in Europe remains the biggest cause of concern, and it still casts a considerable shadow over our economy. While the proposed agreement between the UK Government and the EU is a welcome step forward in the negotiations, the next phase on trade will be significantly tougher, therefore it is essential the Scottish Government is fully involved in these talks so we can protect Scotland’s interests in Europe.

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