Scotland’s ‘golden opportunity’
Some additional commentary on the 2018 EY Scotland Attractiveness Survey from Paul Lewis, Managing Director, Scottish Development International
The latest EY Scotland Attractiveness survey, published today, provides a useful insight on how Scotland is performing. It highlights another record year for Scotland in attracting FDI projects and once again Scotland has been named as the top performing location in the UK outside London for FDI.
With total FDI projects up by 7%, and FDI job creation up 104%, this is certainly great news for the Scottish economy.
Nonetheless, the market for inward investment remains relentlessly competitive; unsurprising given the huge role it plays in stimulating economies. Scotland has had to deliver three consecutive record years to retain its ranking and consolidate its position as the UK’s most attractive FDI destination outside London, so we can’t rest on our laurels.
To compete, locations increasingly have to offer not only strong business fundamentals such as skilled labour and the right business environment; they also need to demonstrate where they are internationally competitive and what sets them apart from the competition.
This has been the approach Scotland has taken to inward investment. Becoming more focussed and targeting our resources on those areas of opportunity where we see more likelihood of success. So it is encouraging to see that these efforts starting to pay off, particularly in areas like R&D investment and in digital FDI.
In recent years, Scotland has capitalised on its strengths in the digital economy and specifically in data science, with both Edinburgh and Glasgow now featuring in the top four UK locations for innovative technologies. We have continued to invest in the capabilities which exist within our universities and innovative companies, and boast world-class academic excellence such as Edinburgh University’s School of Informatics. This is part of an approach to build an environment in Scotland that can generate growth and attract new inward investors, using investments in DataLab – our dedicated data innovation centre as well as plans for substantial investment into Data Driven Innovation led from Edinburgh.
The success of this focus is reflected in the growing number of investors choosing Scotland as a location for their data-driven businesses, and we are aiming to position Scotland as the data capital of Europe within the next few years.
A similar approach is being taken in other sector like high value manufacturing, which has seen a 25% increase in FDI manufacturing projects. This is a very competitive market for investment, and our success in this area reflects the considerable work with industry around innovation and plans to establish a new National Manufacturing Institute for Scotland which will support highly-skilled jobs and help place Scotland at the forefront of advanced manufacturing.
The survey also highlights that, once again, Scotland is the UK leader in attracting R&D FDI. This is a fantastic result for Scotland and it shows that international investors are getting a clear message that Scotland is the natural home for innovative companies. This is down to a number of factors, including the reputation of our academic institutions for driving R&D and innovation and the fact that Scotland has increased the level of R&D funding available to companies to help them develop new products, services, processes and business models in Scotland.
So business reasons are important to investors – and companies choose to locate in places that offer a high quality of life and a distinct identity. There are of course a great many surveys which highlight the attractiveness of Scotland as a place to live and work. And, building on this, we are aiming to accelerate international growth through the new global brand campaign, Scotland is Now. This is a significant development, representing a confident, consistent and bold approach to build a positive and meaningful story of why Scotland is a great place to live, work, study, visit and of course invest.
According to the survey, ‘These findings all point to a golden opportunity for Scotland: the clear potential to capitalise on its proven strengths, by pushing harder to secure a position as the UK alternative to London’.
Now is the time for Scotland to harness this momentum in our response to this ‘golden opportunity’ and that will mean looking at new partnerships and collaborations for even greater international reach and economic impact.