Christopher McGinty: Scotland set to flourish post-Brexit

David Cameron's decision to leave the formalities of negotiating the UK's exit from the European Union to his successor as leader of the Conservative party sets us up for a summer of wild speculation, volatile financial markets and political intrigue.

Christopher McGinty says Scotland can look forward to a 'national revival'. Picture: Contributed

In this spirit I would like to set out why – thanks to English voters – I believe Scotland is poised to enter a golden era of increasing prosperity and national revival.

There is widespread consensus that the principle of free movement of people within the EU was one of the most significant factors persuading English voters to cast their ballots for leaving the EU. The Leave campaign strategists have convinced themselves that the continuing EU will now be prepared to compromise on this principle as part of the UK’s exit agreement.

Sign up to our Politics newsletter

Sign up to our Politics newsletter

Why? Because the EU is desperate to sustain and grow its current trade surplus with Britain. They anticipate an exit deal whereby Britain remains in the single market for goods and services, pays no or negligible fees for the privilege and does not have to commit to the free movement of people.

Read More

Read More
Second Indyref should not be blocked, says Ruth Davidson

From my office in Bavaria, where I can follow events in both the British and German media, it is absolutely clear that Germany cannot possibly agree to an exit settlement with Britain on these terms. Chancellor Angela Merkel has already drawn the red lines as clearly as a succession of British prime ministers have drawn British red lines ahead of EU treaty change negotiations. The British Leave strategists have convinced themselves that they just have to hold their nerve, stick to their demands and the EU will cave in at the eleventh hour.

This will not happen, there will be no orderly exit agreement and the UK will be left independent, outside the EU and without access to the single market.

So, where is the opportunity for Scotland in this bleak scenario?

When it is clear that UK access to the single market has been thrown away there is, finally, a model for Scottish independence which stands up to both political and economic scrutiny:

Scotland votes again on the independence question and, this time, the Yes camp wins.

Buoyed by the enormous goodwill secured in continental Europe by voting clearly in favour of remaining in the EU, Scotland joins the EEA as a first step towards eventual, full membership of the EU.

As a member of the EEA, Scotland has full access to the single market whilst exercising, for the first time, full and exclusive control over energy and fisheries policy (available to EEA countries but not EU members).

Scotland continues to use sterling as its currency, allowing for a period of economic adjustment up until it becomes a full member of the EU.

The golden opportunity for Scotland in this scenario is that there will be a clear and immediate incentive for companies based in England to relocate to Scotland so as to be able to have access to the European single market. In particular, the City of London’s financial services sector (but not banking) would be thrown a life-line which it will most certainly grab.

The Scottish Government should prepare for this scenario whilst participating fully and constructively in the UK’s official negotiating team. It will know it has a “Plan B” up its sleeve whilst England has none. It does not need to take any additional political or economic risks until circumstances demand a “Plan B” – a failure of the UK’s exit negotiations – and it can be implemented swiftly and effectively.

The transfer of both manufacturing and services businesses from England to Scotland will bring about a historical rebalancing of the Scottish economy, eliminate the recent historical reliance on the oil and energy sector and usher in a new golden era. Scotland will flourish and will, forever, be grateful to England for making it all possible.

Wild speculation? Of course. But I am already fielding phone calls and emails from the owners of English companies looking for help to set up and operate new companies in Scotland. Unlike the UK government, they are putting their own “Plan B” in place and Scotland will surely benefit.

• Christopher McGinty is a founder director of Glasgow-based Kreis Consulting, which supplies corporate, business and outsourced administration services with a special focus on the UK and Germany. He divides his time between offices in Glasgow and Erding, Bavaria.