SCOTTISH businesses are calling on the Government to bring confidence to the market after a report published today showed firms are in a period of “stasis” with global and domestic factors contributing to lower levels of confidence and investment.
The Scottish Chambers of Commerce (SCC) Quarterly Economic Indicator for the end of last year was carried out between November and December, suggesting that political considerations had some influence in responses to the survey.
Despite some signs of resilience, the report said confidence levels remain weak relative to long-term norms with manufacturing, retail and tourism registering a negative outlook.
Investment levels remained weak and subdued across all sectors in the survey, an ongoing trend as global and domestic uncertainty continues to affect business communities.
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The SCC warned this was likely to impact on the growth and competitiveness of Scotland’s economy in the coming quarters.
Rises in the price of raw materials and cost of finance compared to previous quarters were also adding to the cost burden across all sectors.
Business rates remained the most significant concern for all sectors with the exception of manufacturing, which cited exchange rates as its main worry.
The survey, carried out by the SCC in partnership with the Fraser of Allander Institute, is the longest-running of its kind in Scotland.
Tim Allan, who chairs the Scottish Business Advisory Group and is the SCC president, said: “Given recent prolonged uncertainty and trading conditions, these flat results are not surprising.
“The business challenges prevalent in 2019 are showing signs of continuing into 2020 with business confidence at worryingly low levels.
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“Of particular concern to businesses will be the extent of divergence the UK Government plans to adopt between UK and EU regulation.
“This continued uncertainty, coupled with a continued sense of ‘election-style’ policy making, has the potential to disrupt business planning and supply chains, as well as negatively impacting on job creation.”
Allan added: “We urge the UK Government to clearly communicate these changes in a timely way and provide substantial support to help firms adapt.”
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