Scottish Government to withdraw overseas trade support for fossil fuel businesses

Companies which focus solely on trade in fossil fuels will have government support for overseas exports withdrawn by the end of the year, it has been announced.

Oil and gas businesses will no longer receive overseas help.

Trade minister Ivan McKee told MSPs there was no place for oil and gas in a new “vision” for Scotland's global trade.

Launching a blueprint for how Scotland will do business around the world, Mr McKee said five principles would guide all future decisions on international trade – inclusive growth, wellbeing, sustainability, net zero for carbon emissions and good governance.

However, he was forced to admit the Vision for Trade did not extend to a plan for increasing Scottish exports.

Pressed on how the blueprint would be used in practice to increase Scottish global exports by Scottish Labour’s Alex Rowley, who raised previous missed previous targets of growing international exports by 50 per cent between 2010-17, Mr McKee admitted the document was a “vision statement” only.

He said it would allow the government “to assess trade-related decisions we need to make ... to navigate the complexities of the global trade environment”.

"It allows us to take policy positions on what needs to be done,” he said. “This isn't a policy statement about how we will increase exports, though that's important.”

Mr McKee also refuted a suggestion by Scottish Conservative MSP Maurice Golden the plan to end "all Scottish Government overseas trade support and promotion activities solely focused on fossil fuel goods and services” by the international climate conference COP26 in November was a “hammer blow” to the economy of the north east of Scotland.

The minister said the move was following up a commitment made by the government two years ago. “We’re now clarifying the position that will happen by COP26 later this year,” he said.

Mr McKee added: “I was in Boston before Covid with a trade mission of very successful Scottish businesses from the north east, who started life in the oil and gas sector, all of whom were transitioning extremely successfully into the renewable sector and we were there to sell that Scottish expertise to businesses in the US who wanted to establish offshore wind industries.”However, while Scottish Greens co-leader Patrick Harvie welcomed the move to withdraw political support “from the lethal fossil fuel industry", he said the document was full of “capitalist assumptions” and asked if there would be less trade in armaments.

Mr McKee replied: “In terms of arms, Scottish Enterprise and agencies don't support businesses which manufacture munitions and any support is clearly to support diversification away from that.”

Responding to a laugh by Mr Harvie, he added: “It’s absolutely true. I don't know why he's got a problem with us creating jobs in sectors that aren’t related to the arms industry. I always find it bizarre that Patrick Harvie and others champion protectionism and against free trade. This is a Trump-like approach to international relations.”

Scottish Liberal Democrat leader Willie Rennie raised past trade deals between the Scottish Government and Qatar and China, which had “suspect connections with human rights abuses” and asked if the new vision would halt such future deals.

Mr McKee said the “substantial document” identified “the levers we have to influence and control where we can, and any deal which came forward now would be assessed on the [document] values”.

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