Tags: Britain | Scotland | independence | vote | business

British Business Welcomes Scotland Staying in UK

Friday, 19 September 2014 06:33 AM

Britain's business community breathed a sigh of relief on Friday after Scotland voted by a clear margin to remain in the United Kingdom.

Markets had fretted that independence would spark a flight of capital amid uncertainty over the future currency, oil revenues, EU membership and dividing up state debt in the event of a separation.

However, Scotland rejected independence in a referendum that left the centuries-old United Kingdom intact but paved the way for a major transfer of powers away from London.

Following the outcome, Britain's major banks and financial groups scrapped plans to move operations south of the border.

"This is a momentous day for our United Kingdom and this result will be greeted by a collective sigh of relief across the business community," said John Cridland, boss of the Confederation of British Industry, the nation's biggest employers' body.

Despite a surge in nationalist support in recent weeks, the "No" campaign secured 55.30 percent of the vote against 44.70 percent for the pro-independence "Yes" camp, sending European stock markets and the British pound higher on Friday.

"Business has always believed that the Union is best for creating jobs, raising growth and improving living standards, and welcomes that the people of Scotland want to play an integral role in this internationally successful partnership," added Cridland.

According to Treasury estimates, around 270,000 Scottish jobs are directly linked to trade with the rest of the UK.

England is Scotland's biggest trading partner, while Scotland is England's second largest trading partner after the United States.

Following Friday's referendum result, Britain's Royal Bank of Scotland and Lloyds Banking Group ditched their contingency plans to redomicile to England.

"The announcement we made about moving our registered head office to England was part of a contingency plan to ensure certainty and stability for our customers, staff and shareholders should there be a 'Yes' vote," said a spokesman for RBS, which is 81-percent owned by the British government after a bailout.

"That contingency plan is no longer required. Following the result it is business as usual for all our customers across the UK and RBS."

State-rescued lenders RBS and LBG, as well as financial services firm Standard Life, had all recently threatened to move operations if Scotland voted for independence from Britain.

However, Standard Life said Friday that it was "proud" of its Scottish heritage and would seek to "continue to build on its success".

Similarly, Lloyds bank added that it was "committed to having a significant presence in Scotland".

Scotland's whisky sector -- which produces the nation's second most lucrative export after crude oil -- also voiced relief.

"The people of Scotland have made a historic choice," said David Frost, chief executive of industry group the Scotch Whisky Association.

"We welcome the stability that this choice brings and now urge politicians of all parties to work to bring our country together."

British drinks giant Diageo, which owns the Johnnie Walker whisky brand and is investing 1.25 billion euros ($1.6 billion) over five years in its distilleries in Scotland, added it would work with Edinburgh and London for the future growth of the industry.

British defence company BAE Systems, which also has significant operations in Scotland, also welcomed the referendum outcome.

"Continued union provides a stable footing and more certain future for our people, businesses and future investments in Scotland," said BAE in a statement.

Top executives at bank giant HSBC and miner BHP Billiton had warned last month Scottish independence would trigger major uncertainty which was "bad for business".

One of the biggest issues in the run-up to Thursday's referendum had been the oil reserves in the North Sea off the coast of Scotland -- which has a direct impact on tax revenues and therefore public spending pledges.


© AFP 2020

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Friday, 19 September 2014 06:33 AM
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