As Covid recedes, Brexit moves clearly into view - Liz McAreavey

The successful rollout of the Covid 19 vaccination programme has thankfully seen economic recovery finally underway, though concerns about the spread of the Indian variant shows how fragile progress can be.

Monday, 7th June 2021, 7:00 am
Liz McAreavey

The news that 3 million people have received at least one dose of the vaccination and 2 million have received both doses in Scotland was welcome, but there are still challenges ahead.

With fewer Covid cases in Scotland – and better outcomes for those who do fall ill – the Scottish and UK Governments can hopefully now focus on protecting our livelihoods and good economic growth. Though just as the tide of uncertainty caused by the pandemic begins to recede, the full force of the impact of Brexit threatens to crash against our shores.

Already we are seeing clear signs. Businesses are once again increasingly quoting Brexit as their major challenge. Exports to the EU are down. The Office for National Statistics (ONS) said that total trade in goods with EU countries tumbled by 23.1% in the first quarter of 2021, compared with the same quarter in 2018 – seen as the last stable trading period.

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In the past few days, a survey of SMEs throughout the UK found that 57% of Scottish

businesses cited Brexit as their biggest challenge – compared to just 30% in the UK as a whole. The survey was carried out by workspace and business finance company Newable.

Concern north of the border may be less surprising when you consider that Scotland’s exports to Europe increased by 4.5% to £16.1 billion between 2017 and 2018 (the latest Export Statistics Scotland figures available). By comparison, exports to the rest of the world increased by half that rate, to £17 billion. Put differently, our five major export destinations include four European nations and the USA.

In the interests of completeness, it should also be noted that the Scottish Government’s export figures put our trade with the rest of the UK at more than £50 billion.

Add to that scenario the ongoing damage caused by the past year of the pandemic and its restrictions and the need for clear, committed leadership is obvious. We need the UK

Government to create a more stable and trusting trading relationship with Europe. We need the Scottish Government to make economic recovery its genuine top priority. We need investment in infrastructure, sensible policies, and a realistic approach to business taxation.

We have many new opportunities to grow our economy, particularly through the ‘Green

Recovery’ that could see Scotland take a leadership role in green finance, green tourism and renewable energy. As COP26 puts the spotlight on Scotland this year, we have a unique opportunity to showcase our leadership in carbon reduction and innovation. Scotland has decarbonised more quickly than any of the G20 nations. We must build on this advantage and access new markets across the world for our green products, innovation and knowledge.

Brexit, international travel and lack of ambition must not hold us back from delivering a

fairer, greener future.

Liz McAreavey is chief executive, Edinburgh Chamber of Commerce