City firms targeted for move north

THE Scottish Government has launched a post-Brexit charm offensive to try to attract City firms to Edinburgh.

However, the chances of success appear remote as it would depend on Scotland staying in the EU and its single market as the rest of the UK leaves.

First Minister Nicola Sturgeon has opened talks with EU leaders but has suffered a series of rejections, with Spanish Prime Minister Mariano Rajoy warning last week: ‘If the UK leaves, Scotland goes too.’

However, Nationalist MP and former investment banker Ian Blackford revealed that discussions have taken place between City financial institutions and the Government.

He said: ‘I am sad to say this, as I would much have preferred the whole of UK to remain in the EU, but there is now a real prospect for higher sustainable economic growth in Scotland than would otherwise have been the case.

‘Scotland’s priority now is to remain in the single market, which would allow us to benefit from “passporting” rights [tariff-free access to the EU single market] for financial services.’

It had been widely assumed that financial firms would relocate some staff, if not entire headquarters, to Frankfurt following the Brexit vote.

But Edinburgh is also a global financial capital and could be a welcome alternative. Last week Mark Garnier, an English Conservative MP and member of Westminster’s Treasury committee, said Scotland could even usurp London’s financial position, if it became independent.

The former banker said: ‘Scotland could do an awful lot by trying to snaffle that financial services hub from London.’

US banking giant JP Morgan has said it expects Scotland to break away from the UK by 2019, probably with a new currency.

The bank, which employs hundreds of staff in Edinburgh and Glasgow and is considering moving 4,000 staff from London, said it expected finance firms to decamp from the City if the UK lost passporting rights and euro-denominated trading.

JP Morgan analysts said that a shift could occur swiftly if a rival European financial centre became the established destination of choice.

Graeme Jones, chief executive of the umbrella body Scottish Financial Enterprise, said: ‘The group will be looking to identify conditions for us to grow financial services in Scotland.

‘We are always open for business and interested to see large companies relocate to Scotland.’

A Scottish Government spokesman said: ‘We are intent on pursuing all avenues to maintain Scotland’s EU status, in line with the way people here voted.

‘Clearly there would be potentially huge advantages to the industry and our economy in terms of jobs and investment if we secure our EU status and position in the single market.’

‘Real prospect for economic growth’