Publication - Minutes

Ministerial Trade Board minutes: September 2018

Published: 23 Oct 2018
Location: Scotland House, London

Minutes of the meeting of the Ministerial Trade Board on 19 September 2018.

Published:
23 Oct 2018
Ministerial Trade Board minutes: September 2018

Attendees and apologies

Chair             

  • Ivan McKee MSP, Minister for Trade investment and Innovation

Present        

  • Eric Balish
  • Russell Dalgleish
  • Rachel Jones
  • Karen Betts
  • Linda Steedman
  • James Withers
  • Jane Richardson

Apologies    

  • Michelle Crossan-Matos
  • Prof. Ferdinand von Prondzynski
  • Afzal Khushi

Also in attendance

  • Brian Conley, SDI, London
  • Deirdre Mcpartlin, UK Manager, Enterprise Ireland

From Scottish Government

  • Stephen Pathirana, Deputy Director, Trade and Investment Delivery Division
  • Suzanne Henderson, Head of Trade Promotion and Trade Support
  • Brian Dornan, Head of Scotland House, London
  • Lesley Ward, Senior Policy Adviser, Trade Promotion

Items and actions

Item 1 - Welcome and introductions

Mr McKee welcomed attendees offering thanks to all of the members for taking the time to travel to London for the meeting. 

He welcomed the input of the Trade Board, in particular the support and guidance they can offer on the development and implementation of the export plan, a commitment in the 2018 PfG.

Item 2 - Apologies, minutes of previous meeting, review of actions

Minutes of the previous meetings were agreed and actions updated on.

Item 3 - London and the South East Market Opportunity and Approach

Brian Dornan, Head of Scotland House London introduced the paper which had been circulated to trade board members in advance. 

Brian introduced trade board members to Scotland House in London, opened last April as a partnership between Scottish Government and SE, HIE and Visit Scotland. Scotland House brings together new and existing staff from partner organisations to provide services to members as well as delivering the combined objectives of the partners.

To date Scotland House has 200 members with the ambition to reach 500 members within the next 18 months. Scottish Government staff use the London base to progress work on UK, EU and international relations, including Whitehall and diplomatic engagement through the ambassadorial network, influencing Whitehall and running Scotland House for its members. Members are interviewed upon joining to understand their objectives with 60% interested in selling internationally through Scotland House in London. 

 While SDI has had a base in London over the past 15 to 20 years their activities have been almost solely focussed on securing and supporting foreign direct investment, it does not focus on trade support. Around 30% of SDI’s FDI into Scotland flows through the London office, both from the UK in to Scotland as well as from global companies. There are trade opportunities for Scottish businesses that can flow through these investment opportunities. For example, US companies, once they have established a European HQ in London, will have the autonomy to make further investment decisions there. This is less often the case for Asian companies. 

In all cases though, there is a mutually reinforcing opportunity when working with large global HQs. Although the primary pitch is investment into Scotland there is demand for information about what else is on offer in terms of supply chain, innovation and research capability. In addition, identifying the right person to approach on inward investment is a real challenge but approaching with a trade offer could be a soft entry and could provide mutually supporting outcomes. 

It was also noted that in London there is a particularly rich seam of existing events in the calendar, such as London Design Festival, so there are already large scale promotional opportunities that could be tapped into. Furthermore, while it is important to get Scottish companies down to London, it is also important to try and persuade London based companies to come to Scotland to see what is on offer. 

Discussion

The Board discussed the paper and the notion of London and the South East as a market. It was noted that figures for sales of goods and services to the UK are tracked alongside exports from Scotland going to international markets. 

There was consensus that the opportunities in and around London are large, sometimes complex, often international in nature and that there should be better co-ordinated and streamlined support available to Scottish businesses who are interested and have the capacity to take up these opportunities. 

There was agreement that exporting outside the UK is more complex and requires more intensive support. The point was made that questions should be asked of companies who are looking at international opportunities who have not yet attempted to do business in or through London. 

The importance of networks was viewed as being absolutely critical but also readiness in terms of the capital, ambition, time to devote to market development, risk appetite and resilience of the business. 

The discussion also considered inward investment and the question of whether there has been any meaningful comparison done between what London has to offer and what the rest of the UK and other comparator/competitor regions in Europe are offering as compared with Scotland. 

Scotland’s current excellent performance on the EY attractiveness index was recognised but there was agreement that drilling down into the proof points that may sit behind this performance would be a worthwhile exercise.  

Several points were agreed upon:

  • there is a ready-made calendar of events across all sectors in London where global players are in market and open to new opportunities. More could be made of this, both in terms of making connections between Scottish companies, particularly SMEs and businesses and on encouraging international businesses to come to Scotland.
  • need to tap in to DIT and other partner’s networks around these types of events and more generally.
  • need to make maximum use of Scotland House in London to support Scottish businesses around these major events.
  • at the service end we should be providing more support at the networking end.

Action:

Brian Dornan, Russell Dalgleish and Rachel Jones agreed to survey Scotland House and Scottish Business Network members to find out more about what they are seeking to accomplish and the support that they think they need.

Item 4 - What Scotland can learn from Ireland?

Mr McKee welcomed Deirdre McPartlin – UK Manager Enterprise Ireland to the Trade Board and invited her to introduce their work to members. 

Deirdre introduced the public sector business and research support landscape in Ireland and outlined the context for the development of Enterprise Ireland (EI) as an antidote to a historic overreliance on inward investment within the Irish economy and a recognition of the need to build economic resilience by expanding the indigenous business base. 

The bulk of EI’s work is directed at working with companies and they are structured by stage of growth aligned to three broad sectors of food and drink; internationally traded services and industrial. The principle being that this enables EI to take a holistic view of the business at that stage of development and to understand the different needs, capabilities and interventions that are required along the growth journey. 

As with similar organisations the services range from one-to-many to intensive account management support provided to companies who have been identified as having high growth potential and which have their investment in place. Account managers look at businesses across 6 pillars of strategy, finance, business innovation, sales and marketing, people/leadership and operations. This is being better connected to the international opportunity and to EI’s 33 international offices. 

There are now around 2,500 active exporters. 80% of what Ireland produces is exported and their future economic sustainability is seen as being built on exports. In terms of export profile, the UK is still the dominant market but that is reducing, now down to 34%. Still strong performance on UK trade (4% growth) last year but EU grew by 9%. The key message around Brexit for Irish businesses is that diversification is key. 

One important area in building ambition was their Leadership for Growth programme with Stanford university. This targeted building ambition and confidence within company CEOs to help them develop and build teams and strategies. This in turn has built a cadre of mentors for other businesses. 

In terms of performance, key indicators are around domestic job creation and export growth.  EI benchmarks itself again against Scotland, New Zealand,  Finland and Sweden. 

Discussion

A number of matters were raised in discussion, key themes were the raising of ambition amongst the business base in Ireland and the way in which Ireland presents itself as a consistent and strong brand internationally. 

The board agreed that the importance of raising ambition should not be underestimated. In EI’s experience, one of the most powerful levers was when businesses were supported to think about their competitiveness in global terms rather than thinking solely in the context of their domestic market. Businesses being supported to have the confidence to work on the business rather than in the business was something that also resonated. Some good examples of businesses who had done this successfully and inspirational leaders were shared.

Interestingly, on “Brand Ireland” the sense from the discussion was that there was no single brand across all of the agencies but the “Global Ambition” and “Irish Advantage” campaigns that had been run were seen as having been hugely effective and there was an awareness of not doing anything to dilute an already well understood message.

Further elements of discussion were around what support is offered to businesses who may have to invest overseas to succeed as this is something that DIT is actively considering; taking a needs based approach to onward referral of clients to private sector or other organisations depending on the support they require and whether it is available within EI; and action to network and connect client companies with one another. 

Several points were agreed upon:

  • there is benefit in reflecting on the differences in approach, in particular on focussing on scale up without a strong sectoral focus and the holistic approach to assessing the needs of the business; this should be picked up with Scottish Enterprise.
  • there may be opportunities to work together where there are complementary offers to maximise impact in market. These should be explored.

Action:

Steve Dunlop to be invited to attend future Trade Board meeting, to speak about broader business support model in Scotland.

Action:

James Withers and Deirdre McPartlin to follow up on exporting potential for meaningful cross border activity. 

Item 5 - A trading nation – our plan for growing Scotland’s exports

Mr McKee outlined the work that he has commissioned to develop a data driven export growth plan for Scotland. This included highlighting the commitments in the  recently published Programme for Government and the work of the Strategic Board export mission as well as outlining the analysis of export performance and market opportunity that has been undertaken to date. The Minister also updated on the next phases of work including the approach to consulting with businesses and the public sector to add the qualitative analysis to the data and to develop the actions in the plan. Trade Board members will have a critical role to play in shaping the export growth plan. 

Discussion

All members welcomed the work that is underway and in particular, felt that the examples of data analysis that were presented moved the agenda forward significantly from previous discussions. 

It was agreed that there is a need to ensure there is an adequate connection between work on the export growth plan and the development of trade policy as there will be a read across in relation to market access and opportunity. This should be joined up. Brexit will be a factor in the export growth plan and in some markets we will be running to stand still while there may be minimal impact in other sectors and perhaps even some opportunities. The key point being that there should not be a one size fits all approach to the plan. This might also apply to the approach that is taken in-market and it was agreed that the plan should consider the markets where it would be important for Scotland to have a distinct presence.  

Several points were agreed upon:

  • the food and drink sector has the most joined up collaborative model and would be a good test bed to validate the data driven approach to developing the plan and testing how to manage discussions across other sectors
  • there is a need to make sure that the connections with the work of the Strategic Board are made
  • there is more to do on export finance to consider what additional options there might be
  • should be using metrics to identify high growth companies and to target them rather than waiting for them to come to us

Action:

James Withers to meet with export growth plan project team to share knowledge and to test data analysis for the sector

Action:

Linda Steedman agreed to work on the development of the holistic view of company support.

Action:

Karen Betts to speak to Nora Senior on export growth plan development to ensure connections are made with Strategic Board actions.

Action:

Eric Balish to scope out options to complement UK offer on export finance. 

Item 6 - AOB

Trade Board members were invited to give their reflections on the meeting and suggestions for the next session to be held in late November.  

There was a request for update information on policy developments that would be of interest to Members between meetings and welcomed a more action focused approach for the Trade Board.  A request was made to avoid, wherever possible, clashes with meetings of other groups with similar membership e.g. the Strategic Board.

Action:

Board Members to suggest format and types of information that would be useful. Secretariat to action based on suggestions received.

Having external speakers worked well and is something that should continue within an extended meeting format of around 3 hours, to allow more time for discussion. The export plan and making contributions in their areas of expertise should be the focus for the board. There is still a desire to have a senior ecommerce speaker to address the board. The work of the board should be shared with other agencies and boards. Steve Dunlop, Chief Executive of Scottish Enterprise should be invited to the next meeting.

END

Contact

Email: James.mcgarvey@gov.scot

J. McGarvey
Directorate for International Trade and Investment
Scottish Government
Atlantic Quay
150 Broomielaw
Glasgow G2 8LU