Brexit leaves massive questions on how Scotland will trade with the European Union

​Thank you very much Presiding Officer.

Can I first declare an interest that I own a business which relies heavily on exports/imports from the EU.

Ever since the Economy Committee was formed in this session there has been concerns over the statistics, particularly in regards to the Scottish economy, that they are not peculiar or dependable to adequately assess Scotland’s economic output.

Leaving the European Union has raised enormous questions over how Scotland will trade with the EU. Even currently there is questions over what value Scotland exports to other countries and I can only imagine how much worse this will get causing further exports from Scotland to go unreported.

During one committee session we had the pleasure of having representatives from the Scotch Whisky Association, Scottish Engineering and Scotland Food and Drink Limited. 

All of which highlighted problems with statistics, showing Scotland’s export power.

The Scotch Whisky Association highlighted that the figures in the Scottish Government’s global connection survey do not always tally with the figures of HMRC.

Scottish Engineering gave the example of a North East manufacturer of flotation devices and umbilicals which were going to the likes of West Africa and South America. Nevertheless, the Office of National Statistics categorised the manufacturer as a non-exporter because it was selling its components to major extractors including the likes of Shell and BP and through intermediaries.

Scotland Food and Drink Limited gave a stark comment saying that although the figures are flawed, provided they are consistently flawed they will still get a sense of direction. However they do take the figures with a huge “pinch of salt” and if I can quote James Withers of Scotland Food and Drink Limited directly

“it seems crazy to me that if someone buys a Scottish steak in a supermarket in Shanghai, we can tell them what farm it came from but we cannot track whether it is a Scottish export using our way of measuring that in the UK.”

Scotland Food and Drink are almost certain that the £1.1 billion of food exports undervalues what we export for precisely. They believe that we are also undervaluing our export salmon, which is our number 1 food export and the UK’s number 2 food export.

This is simply not acceptable.

I fear Scotland’s situation is becoming very similar to the Rotterdam effect - where trade in goods with the Netherlands is artificially inflated by those goods dispatched from or arriving in Rotterdam despite the ultimate destination or country of origin being located elsewhere.

In our case it would be the likes of Felixstowe and trade in goods for England is artificially inflated with Scottish products.

This uncertainty is both damaging to individual companies but also to those industries who benefit from their skills.

I own a business that my son runs which has millions of pounds in turnover of highly specialist coatings for the industrial and automotive industry. Just about 100% is produced in the EU all of which comes via an English port and a substantial amount is stored then shipped from England from holding companies.

Therefore I’m not at all sure if any of this produce is registered as a Scottish import from the EU.

Or is it considered as a UK import from the EU.

Or is it classed as a UK export to Scotland. I have no idea what the definition is.
In normal circumstances, none of this would matter. However, when day after day; week after week figures are being bandied about that potentially is damaging to the Scottish economy then clearly something needs to be done.

No business no matter their size would be without the vital numbers for their performance, never mind a country.

With all the statistics collected by the ONS I find it hard to believe the figures for different parts of the UK are not able to be assembled with confidence. Rather than surveys as it is in Scotland at the moment.

With Brexit its vital the stats are spot on.

Presiding Officer, I commend the committee’s report to Parliament.