Scotland and Europe Frank Strang Directorate for External Affairs Scottish Government Joined up for Jobs Forum, 25 August 2017 Good to talk almost a year on from Referendum vote and following launch in December 2016 of SG’s paper “Scotland’s Place in Europe”. Scale and complexity of task ahead of us is immense; we are exploring all options to protect Scotland’s interests.

Scotland: a European Nation Centuries-long tradition of being outward-facing, European No intention of stopping now International agenda- even with EU – not exclusively about Brexit. Includes trade, culture, research etc etc

But Brexit is a very big deal Massive implications, econ, social and political. [Lack of ] readiness: taken by surprise. No plan Scotland’s vote: > Leave – 38.0%; > Remain – 62.0% Impact on UK constitution FM met PM 15 July. Key message – EU nationals are welcome here.

Scotland’s response: interests Economic Interests – in particular retaining membership of the Single Market Solidarity – supporting the ability of nations to come together for the common good to deal with global challenges Social Protection – ensuring the continued protection of workers’ and other rights Democratic Interests – respecting Scotland’s overwhelming vote to remain in the EU and ensuring Scotland’s distinctive voice is heard Influence – safeguarding Scotland’s ability to shape laws and policies We wish to retain all elements of European Single market membership – the free movement of goods, services, workers and capital. Recognise that the Single Market has removed barriers to trade and opened Scotland to a market of over 500 million people and 21 million SMEs.

“Scotland’s Place in Europe” Dec 2016: first attempt by any administration in the UK to set out a coherent response to the Referendum vote: argues that, in the absence of the ideal scenario of continued EU membership, Scotland should remain in the European single market. calls on the UK to deliver full single market membership in the forthcoming negotiations, preferably for the UK as a whole and certainly for Scotland. sets out how this could be achieved by negotiating either continued EEA membership for the UK or a differentiated approach allowing Scotland to remain an EEA member. Very important that we put on the table serious proposals setting out a coherent way forward. UKG sadly lacking in this respect. Reaction to paper has been generally positive – we have not been shot down. Important to stress that we are listening to both ‘Leavers’ and ‘Remainers’. The paper is a compromise for us in a spirit of seeking consensus – no secret that our Ministers would have preferred the UK to stay in the EU. We do not claim the proposals will fully protect Scotland but they will mitigate the worst damage of Brexit. Unfortunately, the proposals have yet to be addressed by UKG; Scotland’s efforts of compromise have been unheeded and, to date, the UKG has not acted in good faith by giving our proposals any serious consideration. makes clear that, whatever form Brexit takes, more powers will need to be devolved to the Scottish Parliament to allow Scotland to protect its interests.  

Single market “Membership” – what’s in a word? Much more than access All 4 freedoms: goods, services, capital, people All sectors: not just cars or banks.. The standards that go with them: environmental, social etc Into the future: digital etc Many reasons for wanting people!

Where are we now? EU negotiations started on “divorce terms”; may start talks on future from October Scotland in a distant ante-chamber Focus on powers: whither devolution?

What does all this mean for Edinburgh? Businesses: what’s at stake? People (quantity of staff – fruit pickers; quality of staff – Uni of Edinburgh and Fintech companies) Profits – costs/markets/funding Practicalities – red tape , uncertainty Key Sectors Tourism (staff and customers) Finance (passporting, staff travel, regulations) Higher Education (accepting EU qualifications etc) R&D (collaboration, funding, standards) Demystifying to help people plan; giving a voice; reassuring

Questions? Any questions? Thank you for your time Frank Strang@gov.scot