Iain Macwhirter Columnist Sunday 2 March 2014 IT wasn’t so much the dam busters as the blitz. A co-ordinated assault, led by the Prime Minister, backed by the City of London financial establishment, and endorsed by Scotland’s Labour leader, Johann Lamont, echoing the Proclaimers at FMQs: “Standard Life no more; RBS no more; ship-building no more …” Quote us no more, replied Craig and Charlie Reid, who were furious at being enlisted into Project Fear. This is beginning to sound like the economic equivalent of war. The “dam busters strategy” – as the Coalition is reportedly describing it – is a telling insight into the mind of the UK establishment as it seeks to demolish nationalism. The idea was that, after the UK Chancellor ruled out sharing the pound, a flood of companies would rush out of Scotland. The strategy relied on a supportive Scottish media to spin the bouncing bombs and it didn’t disappoint. Newspaper readers could be forgiven for thinking last week that Scotland is heading for economic disaster if it votes Yes, with banks taking their money and running from an independent Scottish banana republic. So it may come as a surprise to learn there was confirmation last week that an independent Scotland would not only be economically viable, but could have a highly successful and diverse economy with a healthier credit rating than the UK. I know this makes me sound like an SNP press release, but I am not a member of the SNP and never have been. However, I simply can’t help seeing last week’s events in a rather different light than most of the Scottish media. On Tuesday, we learned that, far from the oil running out, Scotland is on the cusp of another oil boom, according to a report from Sir Ian Wood, commissioned and endorsed by the UK Government. It said there are still up to 24 billion barrels of recoverable oil, worth about £200 billion in additional revenue, and £1 trillion-£2trn in reserves. Environmentalists rightly raise questions as to whether it is right to suck these hydrocarbons out in the shortest time possible. Yet this was reported in one newspaper as the “North Sea’s greatest crisis in 50 years”, based on the observation that production has been declining. Most of the “easy” oil has been extracted and the revenue wasted, but there is still almost as much oil left in the North Sea as has been taken out over the last 40 years. There can no longer be any debate about the existence of this very substantial asset. We also learned last week that, according to one of the world’s biggest rating agencies, an independent Scotland might have a AAA credit rating even without taking the oil into account. Standard & Poor’s reported on Thursday that an independent Scotland would “qualify for our highest economic assessment”. Its analysts looked at Scottish economic fundamentals like on-shore GDP and concluded that an independent Scotland would be up there with triple A-rated countries such as Germany. Standard & Poor’s recognised that there was a risk associated with monetary disunion and the possible departure of banks, but it didn’t take them very seriously. Indeed, it said that losing some of the big banks might be a benefit to an independent Scotland as a top-heavy banking sector could cause trouble if one institution went bust.
Posted on: Sat, 08 Mar 2014 02:17:21 +0000
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