Scotland sees uplift in financial and related professional services exports
Financial and related professional services are the largest sectoral contributor to Scotland’s economy
Scotland exported £9.2bn of financial and related professional services in 2021, up 3.1% from 2020, which saw a decline due to the Covid-19 pandemic.
Almost half (47%) of Britain’s £134.7bn financial and related professional services exports in 2021 originated outside London, with Scotland generating 6.8% of these exports.
Financial and related professional services exports from Scotland increased by 3.1% year on year in 2021*, exporting £9.2bn of these services, according to a new report from TheCityUK.
The report, ‘Exporting from across Britain 2023’, provides analysis of the latest available data (2021) on financial and related professional services industry exports broken down by regions and nations across Great Britain.
It also reveals that in 2021, total financial and related professional services exports from across Great Britain reached £134.7bn – approximately £25 in every £100 of exports income. Nearly half (47%) of that contribution originated outside London, with Scotland making one of the largest export contributions of 6.8%. In terms of the destination of those exports, 24% went to the EU and the remaining 76% went to the rest of the world.
Sandy Begbie CBR FRSE, Chief Executive, Scottish Financial Enterprise, said: “Scotland’s world-class financial and related professional services industry is a linchpin of our economy, providing hundreds of thousands of high value jobs and helping to fund vital public services.
“The latest exports figures from TheCityUK highlight the continued strength and resilience of our industry, which successfully weathered the pandemic and made a strong recovery in 2021 with a 3.1% increase in exports.
“The upward trajectory of exports from 2011-2021 underscores our position of strength and our vital importance to the future of the Scottish economy.
“Looking ahead, we have all the ingredients for sustainable long-term growth. We have core strengths across every industry sub-sector and are well placed to respond to the key trends shaping the industry like green and sustainable finance and fintech, and emerging technologies such as artificial intelligence.
“Our new sector growth strategy will help us galvanise momentum and take advantage of new opportunities, supporting even greater export growth in the years ahead.”
Anjalika Bardalai, Chief Economist and Head of Research, TheCityUK, said, “Financial and related professional services make a significant contribution to the UK economy through their exports. This is especially true in Scotland, which has one of the biggest and most established financial hubs in the UK. In 2021, industry exports rebounded in Scotland and, in fact, across most British regions and nations, following declines during the Covid-19 pandemic in 2020.
“With nearly half of all financial and related professional services exports coming from outside London, the notion of London being the only place in the UK catering to international markets is a fallacy. The data also underline the contribution Scotland plays in making the UK one of the world’s leading international financial centres.”
This report follows TheCityUK’s ‘Enabling growth across the UK 2023’ report, which found that the economic output of Scotland’s financial and related professional services industry grew 27% over the decade to 2021. It also revealed that in 2021, the industry employed 136,000 people in the Scotland, representing 5.2% of the region’s total employment, and contributed almost £14.3bn to the local economy.
In its ‘Exporting from across Britain 2023’ report, TheCityUK sets out a series of policy recommendations where industry, government, and regulators can work together to support all parts of the country to continue to grow their export potential. These include:
Improving trade information accessibility
Enhance access to holistic, high-quality market intelligence and trade advice for potential exporters.
Involve devolved leaders across the UK’s regions and nations in developing a centralised tool to promote and attract investment into critical project in their areas.
Improve data collection on services trade to enable policymakers to better understand where growth opportunities lie.
Expanding the UK’s global financial and related professional services opportunities
Leverage the UK’s status as a leading services exporter to promote service liberalisation in international forums.
Focus on enhancing regulatory coherence with developed markets and deepen ties with emerging economies, such as China, India, Indonesia, and the Gulf states.
Emphasise the necessity of regulatory cooperation with trade partners to address regulatory divergence and remove bilateral trade frictions.
Building UK leadership in future demand areas
UK-based businesses and government should work together to:
Transform the UK into a global hub for data and technology, using trade and investment policy to position itself at the forefront of technology and innovation within a more integrated global digital market.
·Position the UK as the world’s premier gateway for international investment opportunities through reform of the UK's listings regime.
Full regional and national data is available in the report: ‘Exporting from across Britain 2023’.