The latest export statistics for Scotland were published yesterday, 30 January 2019. This blog examines these figures in relation to the Scottish Government’s exports target, and looks at where Scotland exports to and how trends have changed over recent years.
Yesterday’s statistics confirm what many observers anticipated a few years ago – the Scottish Government has not met its target to increase the value of international exports by 50% between 2010 and 2017. Over this 7-year target period, Scotland’s international exports increased in value by £8.3bn, or 35%, so £3.7bn short of the target.
A more international Scotland?
Regardless of the Government’s target, has Scotland’s economy managed to become more international over the period? Not according to the following graph, which shows that total exports as a percentage of GDP actually reduced, albeit slightly, between 2010 and 2017.
It’s worth remembering that over this period there have been two Scottish Government economic strategies, a dedicated international trade and investment strategy, a Scottish Parliament inquiry, a UK Government inquiry, and hundreds of millions of pounds spent through Scottish Enterprise and Highlands and Islands Enterprise, all aimed at encouraging more businesses to “go international”.
Exports to the rest of the UK
Scotland’s sale of goods and services to other parts of the UK are also categorised as exports in yesterday’s publication. As a percentage of total exports, the value of rest of UK sales remains considerably higher than our international exports. However, it is clear from the following graph that the value of exports going to the rest of the UK, as a share of total exports, has fallen slightly over the past seven years, whilst international exports have increased.
Exports by destination and good/service
It is interesting to compare what we export internationally with what Scotland sells to the rest of the UK. The following graph shows that food and drink remains our largest international export, with professional, scientific and technical services now ranked second (having seen growth of 51% since 2010).
Looking at rest of UK exports, we can see how important financial services are, with sales of £9bn in 2017. Utilities, and services generally, are also significant exports to the rest of the UK. It is clear that the value of food and drink sales to the rest of the UK is smaller than the value of food and drink exported to other parts of the world, possibly testifying to the enduring appeal of our national drink to whisky lovers across the world.
What happens now?
In yesterday’s press release, the Scottish Government highlighted the impressive increase seen in international exports between 2016 and 2017 (+ 6.2%). The UK Government chose to focus on the continued importance of the rest of UK market to Scotland’s economy. However, all sides of the political debate will agree that Scotland must try to increase the number of Scottish exporters. We should know more about how the Scottish Government plans to do this when its new internationalisation plan is published in Spring.
Greig Liddell, Senior Researcher, Financial Scrutiny Unit, SPICe
Andrew Aiton, Data Visualisation Manager, SPICe