Comment: Partnering with developing economies

Pakistani Muslim women offer Eid prayers at the historical Badshahi Mosque during the first day of the Eid al-Fitr religious festival in Lahore, Pakistan. Picture: Getty

It may seem a million miles away from Scotland, separated by more than geography, but a recent trip to Pakistan with the British Council confirmed that we have more in common than we may suspect when it comes to economic development.

I was invited to Pakistan by the British Council to advise universities in Islamabad, Faisalabad and Lahore about business growth and incubator centres and how the country can better tackle the need to develop its economy by growing private businesses.

It’s a tough nut to crack at home, even with our well-developed western economy, our relative wealth, our legal systems, our day to day security, our high skills and educational levels, and infrastructure. Imagine the scale of the task when you must factor in a largely under-developed economy, relative poverty, poor educational attainment, and an often turbulent and insecure security and regular power outtages.

Attracting investment in such circumstances is enormously difficult. So the focus on encouraging, identifying and growing businesses becomes ever more important.

In this country, we work hard to attract foreign investment – and we are good at it. But we still maintain a major focus on trying to develop our own businesses, identifying those which offer the greatest scope for growth and thus generating jobs, opportunities and wealth.

In Pakistan, the government is trying to help develop the economy, and one strand of that involves business growth. That is something we are getting better at in this country, but that we have struggled with to some extent also – that desire to fan the flames of entrepreneurship to stimulate successful businesses that make up a successful economy.

In looking at what Pakistan might do, I was forced to revisit what we do in this country and, in my own case, what we do in Irvine Bay in North Ayrshire. And doing so was interesting, in that while some of the strategic fundamentals remain constant in Irvine or Islamabad, the implementation becomes the real issue that has to be faced.

And in that there are lessons to be learned for us also. We have spent decades refining our economic development expertise and strategic ability in Scotland, yet for all of that we still find ourselves with much to do. And while the strategy might appear to be on the money, we still often struggle to ensure all of the threads join together to form a stronger strand.

So what fundamentals do we share?

• The need for national and local government to be committed to developing, promoting and funding initiatives to support business development and start up, in particular in those sectors which have greatest growth potential

• Government working to de-risk investment in potential high growth businesses by supporting investment funds to work alongside private funders

• Ensuring universities play a key role. As innovators, researchers, and developers of skilled and educated people universities are vital hubs in business development. University incubator programmes should be developed and linked to the national business growth initiatives. Universities should be encouraged to forge closer links with the private sector, in particular to look at contract research and commercialisation opportunities. They also need to collaborate to overcome barriers to growth and improve understanding of collaborative work with private business.

• Business start-up initiatives should seek to encourage greater numbers of people to launch their own businesses. Business incubators are also vital, and these create environments and cultures, often housed within a university or college, and can often be sector specific. These can be resource intensive, and so need to be based on a broader partnership involving a number of institutions and businesses.

• The success of incubators depends on the quality of support and advice on offer, rather than on the simple provision of space.

These are all areas in which Scotland has learned, and is now exporting that knowledge around the world. But it would be foolish for us to believe we have cracked this issue – far from it. In going through a process such as the one I have undertaken in Pakistan, what is driven home is that while we undoubtedly have a level of expertise, our ability to pull it all together is what will ultimately create lasting success or not. And while we continue to shoulder that task, others – including countries in the developing world – are learning from us and learning fast.

• Patrick Wiggins is chief executive of the Irvine Bay Regeneration Company www.irvinebay.co.uk

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