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Following several attempts at independence in the past millennium, Scotland may well succeed this time but the UK economy will suffer

On 18 September 2014, in Scotland, a referendum is to be held to potentially acquire total devolution of power to be handed down to a sovereign independent state of Scotland, with total economic freedom and without any English interference.

Scotland and England have had a long and intertwined history, including two Scottish wars of independence, dating back to 1296 and 1332 – both times with the Scots rebelling against English invaders. Later in 1603, the Scots ruled over England, as King James VI of Scotland inherited the English throne through fortunate circumstances. The Scottish rule of England was short lived due to the religious ferment thrown up by the English civil wars, which resulted in Oliver Cromwell leading forces against Scottish armies and gaining control of Scotland under the Commonwealth of England.

Scotland continued as a separate kingdom until a period of economic stagnation and poor harvests, resulting in many members of the Scottish parliament seeing their country’s future hitching a ride on England’s economic success.  This followed the unification of the Kingdom of England and the Kingdom of Scotland under the ‘Treaty of Union’ in 1707, which included a common currency and a unified parliament. Prior to the Treaty of Union, Scotland had been a sovereign state for over 800 years.

Power devolution

In recent times there may have been cultural differences, and some Scots have held feelings of impotence due to the lack of total control over Scotland’s affairs.

Rise in Scottish nationalism resulted in Scotland holding a referendum in 1998 for a devolved Scottish parliament and succeeded with a majority. The United Kingdom parliament retained responsibility for Scotland’s defence, international relations and certain other areas.

In the fourth Scottish parliament in 2013, the Scottish National Party proposed a bill to hold another referendum for total devolution of power to be handed over to an independent Scottish country. The bill passed with a majority and a date for the referendum was set for the 18th of September 2014.

Impacts of a possible independent Scotland

Scottish nationalists argue that being part of the UK has held Scotland back, while opponents argue that being part of the UK has played an integral part in the Scottish economic success.

The Scottish economy is a large part of the total United Kingdom economy generating substantial financial funds from industries such as North Sea oil, export of whisky, electronics and financial services.

England may have a strong economy and currency, but the lack of an estimated £15 billion of annual influx from the North Sea oil and the various Scottish produce exports may hurt the UK economy and have a significant impact. Data from 2012-2013 shows that Scotland generated 9.1 per cent (£53.1 billion) of the UK’s tax revenues.

There may be possible benefits of going alone as a nation for Scotland but losing access to the UK’s market of 60 million people and seceding from a large powerful state may hold detriment.

Success stories

Scots may be encouraged by the prosperity of a couple of developing economies in Europe. One of the biggest examples of this prosperity is Slovakia, which broke off from the Czech Republic in 1993. Slovakia was known to be the weaker and less prosperous half of the Czech Republic but it is currently developing immensely without the Czech half – direct foreign investment in 2005 was shown to be $1.9 billion, compared to $756 million in 2003. Recent manufacturing plants set up by KIA, Samsung and big industrial plants such as of US Steel bode well for the country’s economy. Its economy is growing while that of its “big brother” is contracting. National wealth has soared from just 50 per cent of the EU average 12 years ago to 76 per cent today. It is the world’s biggest car producer per head of population.

In the unified Czech Republic, there was much discourse on inequality between the Slovaks and the Czech; there were comments of  “we are paying for them” and “we are unfairly treated”. This is no longer the case. If Scotland succeeds in attaining total freedom, it will be in complete control of its resources, prosperity and potential failure.

Image credits: http://www.heritage-history.com/books/marshall/island/zpage208.gif