Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

CBI: Scottish independence hitting UK investment

CBI: Scottish independence hitting UK investment

Scottish independence is directly affecting UK investment and is now one of the ‘critical factors’ determining business risk, the head of the Confederation of British Industry has warned.

In a speech to be delivered at the CBI’s annual dinner, Sir Mike Rake said the potential secession of Scotland, alongside the prospect of a British exit from Europe and this week’s European elections, was increasingly clouding investment decisions.

‘We have a successful internal market of over 60 million people, and Scotland’s biggest export market, constituting 65% of all exports, is the rest of the UK,’ said Sir Mike, who was appointed president of the business group last year.

‘Ultimately, because of the range of unknown and unforeseen consequences of independence, it is difficult to see how independence would be better for investment and for jobs. The case has not been made that an independent Scotland would be better for our economy.’  

The CBI caused some controversy among its Scottish members last month when it registered as an official supporter of the no campaign, allowing it to spend up to £150,000 on campaign purposes.

After a dozen members, including major universities and broadcasters resigned from the group to protect their commitment to neutrality, the CBI said it would take no active role in the referendum and asked the Electoral Commission to cancel its support.

Sir Mike also dismissed the prospect of a cross-border currency union allowing Scotland to continue as a member of the sterling area.  

‘On the crucial issue of the pound, it’s clear that, even if it had been accepted (which it has not), a sterling union would lack many of the conditions that are required for a stable currency to function. 

‘We have shared the pound for 307 years.

‘It took just 33 days for Czechoslovakian monetary union to collapse following the separation into the Czech Republic and Slovakia in 1993. The precise details are, of course, different, but the moral of the story remains the same.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play From Private Bank to Private Office: the next generation of ultra high net worth investors

From Private Bank to Private Office: the next generation of ultra high net worth investors

Citywire's Anna Dumas highlights the trend towards private and family offices.

Play The future of wealth management according to disruptive tech expert Andrew Tarver

The future of wealth management according to disruptive tech expert Andrew Tarver

Three private office investors direct their questions about the future of wealth management, to Andrew Tarver, founder of Boldrocket and disruptive tech expert.

Play Sector spotlight: Standard Life Wealth's Jason Day on Europe

Sector spotlight: Standard Life Wealth's Jason Day on Europe

In the second episode of Sector Spotlight, Jason Day from Standard Life Wealth shares his thoughts on European equities.

Your Business: Cover Star Club

Profile: Stenham's CIO on the strange persistence of hedge funds

Profile: Stenham's CIO on the strange persistence of hedge funds

Stenham Asset Management chief investment officer Kevin Arenson believes hedge funds are making a comeback

Wealth Manager on Twitter