In 2018, it was estimated that a Brexit trade deal between the United Kingdom and the European Union could massively hit Scotland’s economy up to £12.7 billion.
With the end of the transition process, the United Kingdom is officially separated from the EU.
Scotland’s First Minister, Nicola Sturgeon is expected to remain in power, and she has promised to make a second referendum happen, until then, the Scotland’s economy is set to be heavily threatened by Brexit.
Brexit creates a much less certain future for the UK and Scotland than formerly expected.
Scottish Constitution Secretary, Mike Russell said Scotland’s GDP could drop by 6 per cent in the next ten years amid Brexit finalization.
Sturgeon’s Government estimated the cost of changes to customs and exports for the UK at £7 billion annually. The Scottish Government also believes the UK should pay compensation to Scotland for the economic impact of Brexit forced on the Scottish nation.
The leader of Westminster, the Scottish National Party (SNP) MP Ian Blackford said: “It is completely unforgivable that Scotland is being forced to pay such a devastating high price for Boris Johnson’s extreme Tory Brexit deal, with mounting costs, red tape, and disruption.
“The Tories must apologize to Scottish businesses and pay compensation to Scotland for the long-term damage they are doing to our economy – costing us billions in lost trade and growth.
“This disastrous Tory Brexit was a completely unnecessary act of economic vandalism, which has been inflicted against Scotland’s will. It is now beyond doubt that the only way to protect Scotland’s interests and our place in Europe is to become an independent country.
“With businesses, industries, and communities across Scotland warning of rising costs, bureaucracy and delays, it is clear Boris Johnson’s Brexit deal has already left the UK poorer and worse off – with absolutely no benefit to Scotland at all. Every promise has been broken.
“The UK Government must now provide an urgent multibillion (pound) package of compensation to Scotland to mitigate the lasting Brexit harm done to Scottish businesses, industries and communities,
“Scotland has been completely ignored by Westminster throughout the Brexit process. People in Scotland have the right to determine our own future, protect our interests, and regain the full benefits of EU membership as an independent country.
The European Union strengthened Scotland’s Trade
Multiple opinion polls indicate the majority of Scots in favour of leaving the UK to rejoin the bloc. If a second referendum comes about, the most controversial debate would be economics.
Scotland’s exports to the EU have reached up to £14 billion worth of goods each year, which consist of half of Scotland’s total exports, equal to 10 per cent of Scotland’s GDP.
Top Scottish firms have benefited from this and have taken full advantage of the European single market, the ability to freely sell to the EU forms the fundamental success of Scottish industries.
With imports and exports facing new barriers, the Scottish economy is expected to be severely hit by Brexit even more than previous expectations.
The EU creates Jobs opportunities for the Scots
Other than trade, investment from the EU in Scotland boosts job opportunities. All EU member states, including the UK prior to Brexit, make contributions to the bloc and receive funding from the European Union budget.
The benefits of EU investment are clear in Scotland. It was for Scotland to receive around £410 million from the European Regional Development Fund for 2014 to 2020.
Around £400 million from the European Social Fund abetted Scotland to tackle poverty and have helped people into employment.
SNP believes EU programmes are extremely valuable to Scotland, as they support international networks, partnerships, cultural ties, and all other benefits that the communities across Scotland receive from the EU.
Brexit threatens the Scotland’s economy and businesses
Brexit is already posing a risk to the future of Scotland’s economy and is creating a chaotic and cluttered future for the country by cutting off Scotland’s access to the European market as the largest market in the world.
The Scottish Government has anticipated the impact of Brexit long before it practically left Scottish exporting firms falling.
Scotland’s economy alone is expected to lose 9 per cent of GDP over the next ten years amid the end of the transition process.
Moreover, the Internal Markets Bill, the new Brexit law, threatens the Scottish economy especially the food and drink sector.
Scottish Cabinet Secretary for Economy, Fair Work and Culture, Fiona Hyslop has voiced her concern to the UK Government at plans for a post-Brexit internal market. She believes that the Bill will jeopardize and undermine the good progress made on common frameworks with the EU.
Hyslop wrote to Alok Sharma in August:
“Coronavirus (COVID-19) is clearly currently the biggest challenge for business and the economy. Unnecessary legislation, which undermines devolution, on top of an entirely unnecessary end to the Brexit transition period will do nothing to protect or promote trade across the UK and beyond.
“If this legislation were already in place, Scotland would not have been able to lead the way on the ban on smoking in public, on introducing minimum unit pricing for alcohol, having rules on the marketing of raw milk consistent with the nature of the dairy sector in Scotland, or taking forward bans on the sale of plastic-stemmed cotton buds and microbeads in cosmetics.
“A linked concern is the prospect of the UK entering into future international trade agreements which might result in lower standard products being accepted into UK markets. Scotland’s world-leading food and drink sector, for example, is built on a reputation for the highest quality produce and nothing should be done to put that at risk.”
The diverse nature of the Scottish economy consists of resource-based activities including food, agriculture), oil and gas extraction, and related engineering in the North Sea, renewable energies, engineering, and technologically advanced sectors notably life sciences in addition to financial services and creative industries.
Tourism is another important source of economic activity in Scotland in addition to all the above.
The economic strategy of the Scottish Government recommends building critical mass in multiple sectors that play a key role in the economy, holding high growth potential and great capacity to boost sustainable economic growth with the aim to expand the areas of international comparative advantage.
Free-trade agreements enable countries to lower potential barriers to trade and avoid getting involved in complicated negotiations that will on the face of it cause barriers that would inevitably make countries such as Scotland poorer and help surge a disastrous economic and social aftermath.
Scotland argued to remain in the bloc for the reason that these privileges will definitely be lost with the UK intending to isolate itself and break all ties with the EU at all costs. At all irrational and acutely damaging costs.
The Scottish National Party is working hard to avoid any dire consequences brought about by the Brexit rush which Scotland didn’t ask for but was forced to accept as one of the four nations.