Pockets of growth prove it's not all doom and gloom, says Watt

Published on Saturday 25 October 2008 15:19

DAVID Watt, head of the Institute of Directors in Scotland, will attempt to raise confidence among business leaders this week in a speech focusing on sectors of the economy that continue to do well.

Watt will tell the IoD Scotland's Shaping the Future conference in St Andrews on Thursday and Friday that, while financial services, domestic construction and retail sales have been hit hard by the downturn, there are still pockets of growth.

In a pre-conference interview he told Scotland on Sunday: "It's not all doom and gloom. I speak to a lot of businesses that are still doing well, including those involved in oil and gas and some heavy engineering companies, such as Howden. But a lot of that growth is being driven by foreign markets, partly India and China, and if they slow down, those areas may be affected."

He said that the expertise being built in the energy sector in the north-east of the country will be "very exportable".

Watt is confident the weak dollar will help attract American tourists to Scotland over the coming year, and that the strength of the euro makes it attractive for firms to sell into continental markets.

However, he is concerned about the effect of the proposed takeover of HBOS by Lloyds TSB on the identity of the Bank of Scotland. "Everyone is worried about losing this Scottish icon. Bank of Scotland sends a message out across the UK and the world that Scotland is a centre of finance. We want to see that identity preserved."

He also warns that if head-office operations are moved out of Scotland, contracts with suppliers, from stationery firms to IT companies, will gradually be shifted south of the border.

If Bank of Scotland Corporate is weakened it will reduce the amount of funding available for start-ups and other small firms, according to Watt.

Also speaking at the IoD conference, Chris Stening, managing director of technology firm Easynet Connect, part of BSkyB, will tell delegates how to survive the downturn and tap into new markets.

He said: "In the short term, businesses will need to think carefully about what they are paying for their technology and know they are getting value for money. In the long term, they must know how to sell to Generation Y, a group of customers who were born after 1980 and are completely 'digital native'."