The Importance of the Blue Economy for Scotland
“Scotland to gain two new green/freeports in Firth of Forth and Cromarty Firth.“
This recent news paves the way for a huge economic boost to the Scottish economy. The new green freeports is a positive reinforcement of the drive to support the blue economy. The new green/free ports are expected to create 75,000 new high-skilled jobs in the Firth of Forth and Cromarty Firth regions, with the potential to bring in approximately £10.8 billion in private and public investment. This is however just a fraction of the opportunities that the blue economy provides for Scotland.
What are green freeports?
The Scottish government took a slightly different approach to the rest of the UK, taking the free port model and adding an environment and social element. The Scottish free ports combine two core objectives, with Scottish Ministers saying that “the “new model of green ports” would be focused on inclusive growth, fair work practices and delivering a net zero economy. Free ports allow firms to import goods and then re-export them outside normal tax and customs rules”. The aim is to allow ports to benefit from tax and custom incentives creating opportunities and high quality jobs in selected areas driving growth and combatting current economic and social challenges. It is expected that surrounding areas will also benefit, attracting investment from UK and overseas as infrastructure improves and new services are required to support the Green Freeports.
Green free ports are however, only part of the opportunity for the Blue Economy in Scotland. Scotland has long been at the forefront of the blue economy with strong marine, fish farming, fishing and offshore wind and wave technologies sectors. The Scottish government document “A Blue Economy Vision for Scotland” sets out the long-term vision for Scotland’s blue economy to 2045 covering all sectors operating in the blue economy from coastal tourism to ship building.
The importance of the Blue Economy for Scotland
As there is no internationally agreed upon definition for blue economy, nations are developing their own approach which aligns with their individual climate goals. Scotland’s view of the blue economy, is activities relating to the marine, coastal and inter-linked freshwater environment of Scotland and includes policies, legislation, programmes and any international or regional management of related activities.
Scotland’s marine area accounts for more than 7 times than that of the land (617,000km2) and is home to a host of species and ecosystems that are not only an important source of employment for a substantial proportion of the Scottish working population but are also a vital part of our ecology and the environment. Protecting and enhancing this natural environment forms a key part of the Blue Economy vision and the Scottish government has pledged resources towards collaborative projects with the public sector, the scientific community and all marine related industries to ensure the abundant natural capital available can be developed and protected. Research conducted by the Scottish government (Gov.scot)highlights just how significant the potential is within the marine industry. As of 2019, it was estimated that the collective Scottish marine industry accounted for £5 billion in GVA and 75,000+ jobs (2.8% of total Scottish employment). The announcement of the 2 new green freeports has the potential to double this number.
The heat map below illustrates the importance of marine related industries as an economic contributor to Scotland, particularly within the coastal and island regions. The 3 main industries (apart from oil & gas) are wave & tidal energy, aquaculture and marine biotechnology. Due to its excellent geographical positioning, Scotland’s location is uncontested for research and innovation of marine technology, accounting for 25% of Europe’s total potential tidal energy. Scotland was the world’s first nation to bring tidal and wave energy to a commercial scale, earning Scotland the right to the title of the world leader in wave & tidal energy.
The Scottish aquaculture sector, and related supply chain, contributes a further 12,000 jobs to the Scottish economy (marine.gov) with seafood exports topping the list of food exports from Scotland with circa £1.0 billion of export sales.
The marine area surrounding the highlands has been recognised as a ‘pristine’ underwater forest that is largely unexplored and has been identified as a potential for innovative growth in the marine biotechnology industry for high value sectors like health and life science, and energy.
It is estimated that wave & tidal, aquaculture and marine biotechnology combined will bring an added value of over £4.5 billion by 2035 to the Highland & Islands region, driving investment and employment across the region.
Government Initiatives
The Blue Economy Cluster Builder is a government led scheme aimed at helping SMEs gain access to resources and skills to help them realise their full potential. The initiative also aims to “level the playing field” for Scottish SMEs competing against international competition.
The government plays a crucial role in driving forward the blue economy, but there must be collective action from the wider public and private sector if we are to harness the new opportunities that can be created within the Blue Economy.
No green without blue
The overarching premise for most businesses in today’s world is the talk of going green. Rarely do you hear blue when discussing how a business can be ‘greener’, when in fact the earth’s surface is 71% blue. The blue economy should and will be a central part of the green economy, therefore it should be considered in your future business plans.
What does this mean for investment?
The rapid expansion and innovation within the blue economy is already providing real opportunities for start-ups and existing players in the sector to explore new opportunities and innovation. Government initiatives such as the Blue Economy Cluster Builder provide support attracting further external investment. Scottish universities and catapults are driving further innovation strengthening Scotland’s position as a leader in the Blue Economy.
How can Scottish business take advantage of the opportunities?
Entrepreneurs are generally excellent at seeking out and exploiting opportunities but, in sectors that are developing at the pace technologies such as wind and wave, keeping up to date can be a real challenge. Ensuring that your team is well connected within the sector, and has the time and “band width” to maintain and focus on the new technologies and initiatives create value. This should be extended to include a focus on government initiatives and support as well as changes in private sector investment.
Who does this apply to?
Any SME operating in Scotland with activities in the Blue Economy is in an excellent position to harness the opportunities that have been previously highlighted in this article. Government can “prime the pump” but it is business that will ultimately drive growth and help achieve Scotland’s net zero targets.
How can Where Now Consulting help?
Where Now Consulting has developed an extensive track record in supporting, advising and partnering with business operating in the Blue Economy, including:
- Wave & Tidal energy
- Algae related products and services
- Marine biotechnology
- Geophysical mapping of the ocean
- Solar energy
- Aquaculture
- Ship building
- Oil and Gas Services
This experience has been gained supporting both Scottish business and companies operating in the Blue Economy sectors in overseas markets. Currently we are supporting a number of European Blue Economy businesses through the FANBEST programme, supported by the European Regional Development Fund (ERDF).
By Aran Dillon
Where Now Consulting Ltd is a business advisory company and consultancy. Focussing on growth and business transformation we work in partnership with our clients to deliver improved business performance. Our team have a range in skills from sales, operations and finance enabling Where Now Consulting to provide a wholistic approach in the support of our clients. Where your business is looking to devise a new strategy for growth, or is looking at business transformation as the result of a crisis of strategy, profitability or liquidity, Where Now Consulting is your partner for future success.