The reality, it seems, just keeps on defying the narrative tiresomely trotted out by Scotland’s detractors.
You get the impression that these doomsayers have certainly not been entirely unsuccessful in planting the seed in the minds of many that Scotland is an unattractive place to invest.
Dispiritingly often, it appears that their narrative involves wilfully ignoring the evidence, rather than just being unaware of it. Who knows?
What is clear, however, from the broader context of many of the negative comments about Scotland and its performance is that large numbers of people want to tell the story of the nation’s economy being somehow inferior to that of the rest of the UK for political ends. And some of them desperately want to do so.
The finger is pointed at the Scottish Government, with disparaging remarks about the education system as well as the economy.
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You might think Scotland’s great attractiveness to foreign investors, shown by survey after survey, would quieten down the carping a little bit. Not so, sadly, with the noise undiminished, in spite of the fact that other parts of the UK would give their eye teeth for such an appeal to overseas companies.
It is heartening however, given the importance of inward investment, that this negativity does not seem to have infected overseas companies’ perceptions of Scotland.
A study published this week showed Edinburgh and Glasgow in good shape in terms of their attractiveness to inward investors.
This research came hard on the heels of a most encouraging survey on Scotland’s attractiveness to foreign direct investors, published earlier this month by accountancy firm EY.
Edinburgh has climbed above Greater Manchester in the latest foreign direct investment (FDI) attractiveness league table of UK city locations published this week by law firms Wright, Johnston & Mackenzie, and Irwin Mitchell.
The Scottish capital climbed two places to secure sixth position, also moving above Birmingham. Glasgow meanwhile rose four places to 11th spot.
London commands the top three spots.
The study places “inner London” first, “London” second, and “outer London” third.
In fourth place is Brighton, and in fifth spot is Oxford.
Birmingham is in seventh position, with Greater Manchester in eighth spot.
Wright, Johnston & Mackenzie, and Irwin Mitchell noted Edinburgh is tied in first place with Oxford on the “qualification levels indicator”.
This might be an interesting fact to those who carp about Scotland’s education system.
The law firms’ investment attractiveness index has been compiled by the Centre for Economics and Business Research (CEBR). It is focused on the largest cities and ranks a top 50 according to “eight indicators related to growth potential, local infrastructure, and local skills”.
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There was much to be positive about in the breakdown of Edinburgh’s performance.
Bryan Bletso, partner and head of international at Irwin Mitchell, said: “Edinburgh excels in the pillars of local skills and local infrastructure, ranking fifth in each. On an indicator level, the Scottish capital ties with Oxford for first place in the qualification levels indicator and boasts a large economically active population, ranking in the top 10.
“It has also seen significant improvement in online connectivity over the year, which, combined with high public transport usage, makes it an attractive investment destination based on the education levels of locals and the presence of reliable digital and physical infrastructure.”
Some people in Scotland might be surprised to hear such a positive take on things, given the constant rubbishing of the nation’s economy and, as noted, also at times the education system by the politically inclined.
Aberdeen was a way behind Scotland’s two biggest cities in the UK league table published by Wright, Johnston & Mackenzie, and Irwin Mitchell but it nevertheless climbed three places to 39th spot in terms of the overall FDI attractiveness rankings.
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The law firms noted improvements for Aberdeen “in the local skills pillar”, a segment in which the Granite City rose two places to rank 12th. This is another interesting finding.
EY’s survey showed Scotland won a record number of FDI projects in 2023, with renewable energy featuring prominently.
The nation last year also retained its position as second only to London among UK locations in attracting new inward investment projects, according to the accountancy firm’s annual Scotland attractiveness survey.
Scotland won 142 FDI projects last year, a 12.7% rise from the previous record annual figure of 126 achieved in 2022. This was the fifth consecutive year of increase. EY noted Scotland was the only part of the UK to achieve this.
And the good news just kept on coming.
The increase in the number of inward investment projects won by Scotland in 2023 was more than twice as sharp as the 6% rise seen across the UK as a whole.
Scotland’s increased FDI flow saw its share of all such projects won in 2023 by the UK come in at 14.4%, up from 13.6% in the previous year. EY observed the 14.4% share is the highest over the past decade.
Deputy First Minister and Cabinet Secretary for Economy Kate Forbes highlighted the importance of FDI in the wake of the EY survey.
She said: “Attracting inward investment is critical to economic growth and driving forward strategic objectives in key sectors.”
Would the detractors disagree with that? Of course, the success of indigenous businesses is also crucial, but we must not underestimate the importance of the kind of high-value inward investment which Scotland has demonstrated great success in attracting for a long time now. Ms Forbes also declared in the wake of the EY survey: “These results show a record performance, with Scotland once again outpacing the UK as a whole and the European Union when it comes to securing foreign direct investment projects, delivering on the actions and priorities we have set out in government.
“From being at the forefront of the energy transition to the rapidly emerging cutting-edge technologies, we have an enormous opportunity to capitalise even further. We will continue to work with our economic development agencies as part of a ‘Team Scotland’ approach to attracting foreign direct investment and bringing more high-quality jobs across Scotland.”
Sadly, it seems that some people are most definitely not on board with the “Team Scotland” thing.
Of course we must take a realistic view of the challenges facing Scotland, as well as the crucial areas in which the nation has delivered a strong performance.
EY rightly noted as it published its survey that there is no room for complacency and this point should be heeded even if there has been no sign of such an attitude amid Scotland’s progress on the FDI front.
However, it would be good to hear even some more neutral tones from the nation’s detractors, rather than the permanent negativity, when compelling evidence points to very significant success for Scotland in key areas such as inward investment.
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