Home U.K Scottish independence: Economy to take £11bn hit, study found: ‘Considerably poorer’

Scottish independence: Economy to take £11bn hit, study found: ‘Considerably poorer’

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Against the backdrop of the pandemic, Ms Sturgeon has pushed ahead with her government’s attempt to haul Scotland out of the UK. The First Minister said last year that her Scottish National Party (SNP) would push ahead with introducing legislation so a referendum on Scottish independence can be held by 2023, COVID-19 permitting. Her pledge to hold a second public vote on the issue came after Scots rejected breaking away from the UK at the 2014 referendum.

This week, the SNP’s Westminster leader Ian Blackford suggested there could be a delay to a second referendum – Indyref2 – due to Russia’s invasion of Ukraine.

However, Ms Sturgeon doubled down on her intention to hold another vote as she was interviewed on LBC this week.

The SNP leader said: “My plans and my thinking hasn’t changed.”

Despite the bold rhetoric from the Scottish government on independence, major concerns remain over the economic devastation that could be unleashed on Scotland if it does pull out of the Union.

A damning assessment of Scotland’s finances published in February last year predicted independence could wipe £11billion from the country’s economy.

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The stark report from the London School of Economics (LSE) and City University of Hong Kong laid bare how Scotland could be left “considerably poorer”.

According to LSE’s Centre for Economic Performance, the impacts on Scotland’s trade with the UK and EU would reduce its income per capita by between 6.3 percent and 8.7 percent.

The authors of the study said this was equivalent to a loss of between £2,000 to £2,800 per person per year.

This means Scotland – a nation of around 5.5 million – could haemorrhage between £11billion and £15.4b billion from its economy annually.

Hanwei Huang, assistant professor at the City University of Hong Kong, gave his assessment of the forecast for independent Scotland.

Ms Sturgeon has argued that the Scottish economy would be stronger if the country was reaccepted into the 27-nation bloc as an independent nation.

However, the report’s authors claimed that being part of the EU would not save independent Scotland’s economy.

Thomas Sampson, associate professor of economics at LSE, said: “We find that the costs of independence to the Scottish economy are likely to be two to three times greater than the costs of Brexit.

“Moreover, re-joining the EU following independence would do little to mitigate these costs.”

The expert added that “in the short run” it would “probably lead to greater economic losses than maintaining a common economic market with the rest of the UK”.

Fiona Hyslop, the Scottish government’s economy secretary, claimed at the time that Scotland’s economy would see the benefits of independence if given time.

She said: “With our economic resources and advantages, control of economic policy and membership of the EU, Scotland would be very well placed to grow the economy.”



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