As Boris Johnston rambled around Scotland and the north of England last week as part of his ‘levelling-up’ tour, he pledged to boost trade and business within the country by creating two ‘green freeports’ north of the border.
Having been on the agenda for a while now, the UK Conservative government has been keen to use freeports to spark a post-Brexit manufacturing boom, with a number of the tax havens announced south of the border in recent times.
However, with a lot of back and forth between Westminster and the SNP-led Scottish government over the past year or two, the announcement for Scotland’s freeports finally came on Valentine’s Day.
A freeport is normally an area of a country where its taxes and tariffs do not apply. Businesses can import goods, store them and re-export them without paying tax.
More recently, firms are now able to import raw materials, make finished goods and then export them, with none of the border taxes that the rest of the country has to pay.
It is an interesting concept that may prove to be an excellent boost for manufacturing in Scotland, attracting more international businesses to the country and allowing them to import goods, turn them into higher value products inside free ports and not face tax and duties until they leave the designated zone.
The Scottish freeports announcement didn’t escape the ire of the Scottish Greens however. In the first real sign of conflict with the SNP, its coalition partner criticised the plans as ’greenwashing’ and said it was a ’corporate giveaway’.
It was stern words from a party which has never been a friend of business, but hopefully they will be proven to be wrong, especially as official figures from the Office of National Statistics (ONS) showed that Scotland’s estimated employment rate fell from 74.9 per cent to 74.1 per cent between October and December. Across the rest of the UK, employment rates rose from 74.6 per cent to 75.5 per cent.
The ONS figures are certainly concerning, so an opportunity to attract businesses and investment to areas in need of support, through such schemes as a freeport is certainly needed.
The Conservatives were quick to put the boot into the Scottish Government over the latest employment figures, citing their perceived slow response to the Omicron variant and rolling out support funding to those businesses most affected by the tough restrictions that the country was put under.
The Fraser of Allander economic research institute at Strathclyde University also added its own thoughts to the latest employment figures, saying that although there had been improvements in headline labour market indicators over the past 12 months, the economy still had a long way to go until it had recovered from the pandemic.
Breaking down the recent figures, Dr Stuart McIntyre, said: “Compared to two years ago, there are still over 34,000 fewer people in employment in Scotland, and over 15,000 more people unemployed.”
The ONS also released figures showing that UK wage growth continued to lag behind the rising cost of living between October and December.
According to the ONS, employees’ regular pay, excluding bonuses, grew by 3.7 per cent between October and December from a year earlier – which is high compared with rates seen over the last decade.
However, the rising cost of food, energy and household goods has pushed inflation up by 5.4 per cent in the 12 months to December. The ONS said real wages in the October to December period fell by 0.8 per cent from a year earlier.
With the rise in the cost of living, pressure will be added to employers as staff members either ask for a wage rise or look to competitors who are providing higher rates of pay.
The cost of living and wages certainly has a roll to play in the formation of Scotland’s new freeports as well, with the Scottish government insisting that businesses operating within the news zones must pay the living wage and provide fair work practices – conditions that are not often met in similar freeport areas around the globe.
Last year the Scottish government named nine areas being considered, and with a bidding process beginning in the spring, it is hoped the new sites will open in 2023.
With the UK government providing £52m of funding for the freeports, it will be interesting to see just how much innovation, trade, growth and money is created for the local economy moving forward.
Glasgow Voted Top City for Small Businesses
It was encouraging to read last week that Glasgow has been voted the best city in the UK for small businesses to be based and to work for.
Thanks to good average wages, short commute times, house prices and business growth, it’s no wonder it topped the list.
Something that did not surprise me though, was the fact that London didn’t even make the top 25, as soaring house prices and long commutes in the UK’s capital are hardly a secret.
Iwoca, an online fintech company – which offers credit facilities to small businesses trading in the UK – ran the study and also placed other Scottish cities, including Dundee and Edinburgh, within the top ten, with Glasgow coming out on top for all aspects of small and medium enterprise (SME) life.
It’s also fantastic to see that our northern neighbours, Liverpool and Newcastle Upon Tyne, are highlighted within the top cities too.
Christoph Rieche, Chief Executive of Iwoca, noted that “the pandemic has fundamentally changed the life choices we now make” and that “big corporations grab the headlines and have the profile, but it’s the small businesses who are making this country tick”.
I wholeheartedly agree and it is our entrepreneurial spirit that will pull us through the pandemic’s aftermath, as small businesses are the backbone of our economy.
It’s great to see Scotland, and in particular, Glasgow, getting the recognition it deserves as a SME hotspot. I hope this positive news means even more businesses will choose to start up north of the border.
It Made Me Laugh
Something that gave me a good chuckle this week was American tourist, Devrie Brynn, who went viral after filming her ‘hike’ on TikTok.
The 30-year-old booked tickets to Scotland on a whim for a big birthday, and her video left 4.5 million viewers, myself included, in stitches!
She certainly showed Arthur’s Seat in all its finery and showcased our famous hospitality that we are all so proud of.
The TikTok-er donned a faux Scottish accent and joked about how red faced she was after her hike up the hill.
In her mock accent she said, “Do I look alright to you, Angus? I’m dying on these trails mate, I cannae dae it, I’m no right”.
It is always enjoyable to see Scotland go viral, and I hope the rest of her visit was just as entertaining.
It Made Me Weep
Western Isle council leaders have been warning that a lack of resilience in the CalMac Fleet has been affecting the delivery of essential goods to Scotland’s Island communities.
Due to the delays and breakdowns, the lack of urgency around fixing this perplexes me.
The Scottish government is pushing for people to move to these islands, but why on earth would they, when residents often can’t get a loaf of bread or get back to the mainland to see relatives, due to the ferry schedule disruptions?
With the islands being a favourite staycation destination, Holyrood ministers must see that this problem needs to be dealt with sooner rather than later, especially when this could affect how Scotland’s economy emerges in a post covid world.
