Published: 19/03/2017 07:00 - Updated: 17/03/2017 16:35

Independence could hit Highland businesses

Written byCalum MacLeod

Inverness economist Tony Mackay.
Inverness economist Tony Mackay.

HIGHLAND businesses could have more to lose from independence than leaving the EU, according to a north economic expert.

Inverness economist Tony Mackay believes the majority of the north business community would vote against independence if First Minister Nicola Sturgeon’s plans for a second referendum in the autumn of 2018 or early 2019 go ahead.

He was speaking ahead of Prime Minister Theresa May’s comments yesterday, in which she appeared to rule out any referendum until after the UK leaves the European Union. However, the Prime Minister did not rule out granting a fresh independence referendum afterwards.

"The latest opinion polls suggest that the Indy Ref 2 vote may be close but I believe that most business people in the Highlands would vote against it," Mr Mackay said.

"England and the rest of the UK account for about 65 per cent of Scottish exports, compared with just 15 per cent for the EU. Withdrawing from the UK would therefore have much greater implications for Highland businesses than Brexit.

"There would be added complications if an independent Scotland applied to remain in the EU because that would involve negotiating new trade deals with the rest of the UK. I am sure that Brexit will have negative consequences for many Highland businesses, but the economic implications of independence would be even worse."

Stewart Nicol, chief executive of Inverness Chamber of Commerce, welcomed the First Minister’s commitment to the Scottish Government continuing to be involved with the political process around the UK’s withdrawal from the EU.

However, he also raised concerns about the prospect of a second independence referendum causing further instability in the economy.

"Scotland has been through two referendums and two major elections over the past three years, and there is no doubt that this period of continual uncertainty has had a material impact upon businesses in Scotland," he said.

"These are real and present business issues that are affecting business decisions and investment. A further referendum on Scotland’s independence would be no different, and the more that can be done to mitigate the duration of this uncertainty for business, the better.

"In the current circumstances, businesses need as much certainty, stability and confidence as possible and it is the role of our governments to provide it.

"The message from Chamber of Commerce members has been clear and consistent – our priority must be to create the conditions that will enable businesses to thrive. That means focus and resources must be directed towards greater strategic infrastructure investment."

Andy Willox, Scottish policy convenor of the Federation of Small Businesses, said a FSB survey conducted between last year’s Scottish Parliament elections and the vote on EU membership had revealed very little appetite amongst smaller firms for another independence referendum.

"Of course, there’s a lot more going on now – in terms of faltering confidence and rising costs – than there was last May," he added.

"What we don’t know is if these changes have shifted views one way or the other, but I daresay that will become apparent in the weeks and months ahead."

Gail Hunter, regional director at The Royal Institution of Chartered Surveyors in Scotland (RICS Scotland) warned that a second independence referendum would increase insecurity for markets already suffering due to the uncertainty surrounding Brexit.

"The prospect of another independence referendum runs the risk of adding additional uncertainty for markets, which are already slowing due to the unknown consequences of Brexit," she said.

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