Economic blueprint welcomed

Harnessing the knowledge economy (Picture: Abertay University).

Scotland needs to address core issues in order to seize export opportunities and build an economy fit for the future, according to a study by the University of Strathclyde’s Fraser of Allander Institute.

The Scotland in 2050: Realising Our Global Potential report canvassed the views of more than 100 business leaders, industry bodies and representatives of public and third sector organisations.

The Institute identified key trends, opportunities and risks that Scotland needs to respond to in order to compete in a rapidly evolving global economy. Crucially, the global nature, of these issues will be important, irrespective of Brexit or other forms of constitutional change.

The report, commissioned by the law firm Shepherd and Wedderburn to coincide with its 250th anniversary, makes eight key recommendations that address low productivity, the skills gap, lack of strategic export focus, outdated infrastructure, political short-termism and the potential for growing pressure on public services as a result of the revised budget arrangement agreed by the Scottish and UK Governments.

It concludes that Scotland needs:

  • Infrastructure, both physical and digital, that is fit for the future
  • An economy that harnesses and trades on knowledge
  • An ecosystem that nurtures and retains businesses of scale
  • An appropriately skilled workforce led by effective management/leadership teams
  • Greater collaboration between academia and industry to commercialise innovation
  • A national strategy focusing resource and investment on activities with growth potential
  • A more joined-up, collaborative approach to entering new markets policy (at local, national and UK level) that is longer term in its objectives

Despite the challenges it identifies, this research shows that there is much to be optimistic about. Scotland has a proud tradition of innovation and entrepreneurialism which, if properly harnessed, will see us seize the considerable opportunities ahead.

Paul Hally, Chairman of Shepherd and Wedderburn.

Ivan McKee, the Scottish Government’s Trade Minister, commented: “We welcome this report which sets out some of the challenges and opportunities for Scotland in internationalisation and is in line with much of our thinking and future plans. Improving Scotland’s export performance is key to Scotland’s economic performance.”

He added: “I want to do everything in my power to support businesses in Scotland sell more products and services internationally. That is why the Scottish Government is launching our export growth plan, A Trading Nation, in May. It will refocus support for exporters to where it will have most impact and is backed by £20m of Scottish Government funding over three years. The Scottish Government is committed to ensuring businesses in Scotland are supported to embark on their export journey.”

Lord Duncan, Under Secretary of State for Scotland, said: “The report’s recommendations are in line with the work the UK Government is doing to ensure economic growth in Scotland and the whole of the UK is maximised.

“The report identifies a number of challenges ‎but by working together – and by continuing to listen to business leaders, industry bodies and public and third sector organisations – Scotland’s two governments can help improve our economic performance.

“The UK Government’s Department of International Trade (DIT) uses its overseas network of more than 1,300 people, working in 108 countries to support exporters from Scotland. DIT also work closely with the Scottish Government and Scottish Development International to support businesses and exports.

“The UK Government’s Industrial Strategy has set out the long-term plan to boost productivity and earning power of people in Scotland and throughout the UK. It is through working in partnership that we will find the innovative solutions to succeed in the future.”

Professor Graeme Roy, Director of the Fraser of Allander Institute, said: “Our economic analysis and engagement with business has shown Scotland has key strengths that should give the country optimism for the future. But in many areas there is scope for improvement; our export base is too narrow and we lag behind many of our competitors. If Scotland is to take advantage of the changing nature of the global economy in the coming decades, it will need to boost its level of internationalisation.”

Dr Siobhán Jordan, Director of Interface, the body linking businesses with academic institutions, was one of the 100-plus industry figures who contributed to the report.

She said: “It is a long-term view, which is interesting but also very necessary. We may be on the right trajectory but there is a need to organise around key sectors and really harness and trade on the knowledge economy with infrastructure – both physical and digital – underpinning that. Growing businesses of scale will be key.

“Essential to that is a skilled and forward-thinking workforce. It’s hugely important that our education system, in considering the workforce of the future, builds on the work being done in both intrapreneurship and entrepreneurship. The graduates of tomorrow need to fully grasp, both as employees and as entrepreneurs, how innovation drives forward businesses of scale. This spirit of innovation is critical for our public services as well.”

Shepherd and Wedderburn is hosting a series of events in Edinburgh, Glasgow and Aberdeen in May to discuss the report’s findings.

“Despite the challenges it identifies, this research shows that there is much to be optimistic about,” said Paul Hally, Chairman of Shepherd and Wedderburn. “Scotland has a proud tradition of innovation and entrepreneurialism which, if properly harnessed, will see us seize the considerable opportunities ahead.”

Download the Scotland in 2050: Realising Our Global Potential Final Report at shepwedd.com/2050.