Business looks bright despite Brexit concerns
Scottish owners confident about trading conditions
CONFIDENCE in Scotland’s business community remains strong, in spite of fears over Brexit and the oil and gas downturn. But inconsistent performances across key industries puts the economy on a “knife edge”, according to figures published today.
In Scotland, 67 per cent of businesses are optimistic about conditions over the next 12 months, according to accountancy firm Grant Thornton. This is down slightly on the 72 per cent measured in the last quarter of 2015, but the research found optimism in Scotland remains higher than the UK average of 44 per cent and the EU average of 34 per cent.
The research also found 61 per cent of business leaders in Scotland believe their turnover will increase in the next year, against a UK average of 51 per cent.
Debbie Mayor, head of international at Grant Thornton in Scotland, said the country’s business community remains resilient and focused on sustainable, longterm growth in the face of growing global challenges.
One of those challenges will be turning around the decline in manufacturing. The Scottish Index of Manufactured Exports fell 1.5 per cent in real terms during the fourth quarter of 2015.
Andy Hall, head of corporate banking for Barclays in central Scotland, said the drop was down to a fall in output and new orders, along with the strength of sterling.
“That said, manufactured export volumes grew by 0.6 per cent in the latest four quarters compared to the previous four quarters, illustrating that if the industry keeps a firm focus on costs and making vital investments there is hope the challenges faced in 2015 can be managed in the coming year,” he added.
The Scottish Chamber of Commerce said manufacturing is expected to recover from its dip over the next few months.
Its quarterly economic indicator showed construction, which was influential in keeping the Scottish economy out of recession in 2015, performed strongly in the early part of this year and continues to demonstrate positive expectations.
Growing online sales have helped to boost confidence in the retail sector, though profitability is down, while a strong performance amongst tourism businesses masks tightening profit margins and weak confidence.
The lobby group said the prime objective of the next Scottish Parliament must be economic growth. It also called for a reduction in business rates.
Liz Cameron, director and chief executive of the Scottish Chambers of Commerce, said: “As Scotland prepares to head to the polls for next month’s Scottish Parliamentary elections, we know our economy is on a knife edge between growth and recession and that the prospects for the future are unclear”.
She said that in these circumstances it is imperative the new Scottish Government puts the economy at the centre of its plan for government over the next five years.
‘‘ If the industry keeps a focus on costs there is hope challenges faced in 2015 can be managed in the coming year