Meeting of the Parliament [Draft]

Meeting date: Thursday, September 10, 2015

Official Report 836KB pdf

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Internationalising Scottish Business

The first item of business this afternoon is a debate on motion S4M-14190, in the name of Murdo Fraser, on internationalising Scottish business.

I am delighted to open this debate on behalf of the Economy, Energy and Tourism Committee. This is our second committee debate in the space of eight days. Last week I rather enjoyed hearing various members of other parties express their discomfort at having to vote for a motion in my name; I look forward to the horror that will hit them at 5 o’clock when they realise that they will have to have that experience two weeks in a row—I hope that it becomes a habit.

There can be no disagreement that helping Scottish business to boost exports should be a top priority for everyone who is concerned with Scotland’s economic performance. I think that our inquiry into internationalising Scottish business makes an important contribution to current thinking about the drivers and barriers that influence Scotland’s international trade.

I thank my fellow committee members, committee clerks and all those who gave evidence to the committee and assisted us with external visits; their help was invaluable to us in producing our report.

Before I turn to our conclusions, let me set the context for the inquiry. In 2010, the predecessor Economy, Energy and Tourism Committee held an inquiry to examine the work of Scottish Development International, which is the international arm of Scottish Enterprise and Highlands and Islands Enterprise. Members considered SDI’s dual role of encouraging inward investment and supporting exports from Scotland. The committee concluded that SDI’s primary focus should be on achieving

“a step change in the number of Scottish companies that see exports and international trade as a route to future success.”

The report prompted a review of SDI’s strategy and the publication, jointly by the Scottish Government, Scottish Enterprise, Highlands and Islands Enterprise and SDI, of “Scotland’s International Trade and Investment Strategy 2011-2015”. Five years on, it seemed appropriate to review progress.

Back in 2011, the Scottish Government set a target to increase exports by 50 per cent by 2017. That looked challenging but suitably ambitious, as part of the Government’s wider strategy to support business growth. Our committee was pleased to note that significant progress has been made towards the target. However, as we looked more closely at the facts and figures, the committee was concerned that Scotland’s exports remain concentrated heavily with a limited number of large firms. Around 100 companies account for 60 per cent of total exports. By contrast, only 16 per cent of all international exports are from small companies.

We wanted to explore the reasons why so many Scottish firms, particularly small and medium-sized enterprises, do not export. What is preventing them, and what more could be done to change that?

From salmon to whisky to universities, Scotland has real success stories overseas, but breaking into lucrative international markets can sometimes be time consuming, costly and difficult to do, especially for small businesses. That is when small businesses need support, which could come from a business gateway adviser, a local chamber of commerce or a specialist who works for SDI or its United Kingdom counterpart, UK Trade & Investment. Whatever the source, support needs to be easy to identify, easy to contact and easy to deal with. We were disappointed to find that all too often that has not been the experience of businesses across Scotland.

Although there is no doubt that all those organisations—and others—undertake much positive work to increase Scotland’s export performance, it became clear during our inquiry that the landscape of support remains cluttered, confusing and ultimately off-putting for many businesspeople.

Although plenty information is available about international opportunities and export-related issues, it seems only to add to the sense of confusion about where to go and who to speak to. As an example, the committee heard that trade missions were a key part of helping companies to break into overseas markets, but that more needed to be done to improve co-ordination, reduce duplication and eliminate unnecessary competition between organisers of trade missions.

Helpfully, the Scottish Government says that it agrees. Discussion on an appropriate platform for publication of trade missions online is apparently a key issue for the pithily titled international events community of practice that the SDI has recently established. I wish it well in its endeavours because issues such as these need to be tackled urgently. Above all else, that will require leadership.

We concluded that overall responsibility for co-ordination and leadership of export strategy and initiatives in Scotland should rest with SDI as the main public agency that is tasked with international support for business.

At this point, I must acknowledge that we found many positive examples of SDI’s work; its interventions and programmes are valued highly by many companies around Scotland. However, if Scotland is to make a step change in its international export performance, SDI can and must do more. We recommended that it should have within its operating plan a renewed emphasis on promoting internationalisation and supporting Scottish exporters, backed by more challenging targets.

That does not mean that SDI should do everything. We also expressed strong support for sectoral initiatives to increase exports, such as that led by Scotland Food & Drink, where industry leadership has been supported and facilitated by SDI and the Scottish Government.

James Withers of Scotland Food & Drink told us that his sector attached huge value to SDI resources, but it was industry’s responsibility

“to help it to deliver better”

by setting the framework so that there was

“industry leadership and public sector alignment.”—[Official Report, Economy, Energy and Tourism Committee, 18 March 2015; c 39.]

In the seven highest priority markets—France, Germany, North America, the middle east, China, Japan and Singapore—new food and drink trade specialists are being recruited to join the existing SDI field teams. I am told that, from the beginning of this month, 10 specialists are now in post around the world helping to promote Scottish producers. It is good news that the Scottish Government has accepted our recommendation that SDI should review the success of this initiative after its initial period of operation to see whether other key sectors might also benefit from a similar approach.

We were also struck by the potential for enhanced collaboration at the regional level. When committee members met representatives from Aberdeen and Grampian Chamber of Commerce, we were told about the north-east Scotland trade group, which involves Aberdeen City Council, Aberdeenshire Council, the chamber of commerce, SDI, Scottish Enterprise, UKTI, the University of Aberdeen, Robert Gordon University and Subsea UK. All are sharing information to reduce duplication and improve collaboration. We have recommended that the enterprise agencies should look at whether that model could be usefully replicated elsewhere in Scotland. Perhaps that is another task for the international events community of practice.

Let me say a little more about the priorities for action that the committee identified. First, in order to make it easier for businesses to find the basic information that they need when starting their export journey, we recommended that a business portal should be developed that would include signposts to export advice and assistance from public and private sector organisations.

The Scottish Government has decided that that belongs on the mygov.scot website. Members might think that I am a little sceptical, but I wonder about the likelihood of the owner of a small business finding what they need to know about exporting among all the other information that is contained on that site. Time will tell whether that is a wise decision.

In terms of business advice and support services, the committee identified a clear opportunity to better utilise the globalscot network. Globalscot is

“a diverse network of business leaders, entrepreneurs and executives with a connection to Scotland - and a strong desire to see Scottish businesses succeed locally and in the wider world”—

so says its website.

Perhaps surprisingly, 17 per cent of global Scots are based here at home in Scotland. That presents an opportunity, with a potential role for them to act in a mentoring capacity with companies at an early stage of their export journey. Those members who made the trip to the middle east met a number of global Scots based out there, and it was clear that they take a great deal of interest in helping Scottish exporters in that region. We think that more could be done, however.

We believe that using global Scots at home could help to augment the highly valued but more general business mentoring scheme that is already delivered by Scottish Chambers of Commerce. We asked SDI to review the means by which businesses can access the globalscot network and to increase the number of one-to-one engagements between global Scots and companies in order to maximise the benefits from the scheme.

We concluded that SDI’s new export support programme, which was set up in 2014 as the successor to smart exporter, has set a relatively modest target of support to companies. For that reason, we recommended a review after 18 months of operation, with a view to making targets for the remainder of the programme more challenging. We are told that SDI will consider those points. I hope that more challenging targets for support to Scottish exporters will be one recommendation that is accepted and pursued.

I confirm that the Economy, Energy and Tourism Committee believes that the expansion of support to companies that have export potential is of vital importance if Scotland’s international trade performance is to be improved significantly over the next decade.

Henry Ford once said:

“Coming together is a beginning; keeping together is progress; working together is success.”

It is that spirit of co-operation and collaboration, which will be reflected, I hope, in this afternoon’s debate, that needs to be grasped if we are going to improve export support services for Scottish businesses.

On behalf of the Economy, Energy and Tourism Committee, I am delighted to move,

That the Parliament notes the findings of the Economy, Energy and Tourism Committee’s 5th Report 2015 (Session 4), Internationalising Scottish Business (SP Paper 719).

14:42  

I thank the Economy, Energy and Tourism Committee and its convener for the report that it has presented.

When I gave evidence to the committee in March, I welcomed the inquiry that was being undertaken on internationalising Scottish business, which represents a significant priority for the Government. I have considered the report that has emerged from the committee with great interest, particularly as we take steps to develop a new trade and investment strategy for Scotland to replace the existing strategy.

The Scottish Government formally responded to the key issues and recommendations in the committee’s report on 19 August. This afternoon’s debate provides an opportunity to examine them in more detail.

Our programme for government, as set out last week, reaffirmed our ambition to make Scotland the best place in the United Kingdom to do business, through focusing on the four pillars of our economic strategy: investment in people and infrastructure, innovation, internationalisation and inclusive growth.

Internationalising Scottish business is a key priority for the Government. Our focus is on creating an environment that supports companies to grow and to enter new markets, and which ensures that Scotland remains a highly attractive location for inward investment. As was set out in the programme for government, we will do that in a number of different ways.

SDI will continue to lead work in Scotland and its overseas offices to promote Scotland’s exports and to champion Scotland as a destination for international investment. Our new innovation and investment hubs in Dublin, Brussels and London will provide places for Government, Scottish Development International, other agencies and public partners and the private sector to make international connections that will boost exports and attract investment, in addition to supporting the priority of expanding innovation.

We are investing in infrastructure to deliver major improvements to business connectivity, and we have set out our intention to reduce air passenger duty within the next parliamentary session, incentivising connectivity to key markets.

We are ensuring that companies have access to the right finance. Our new £40 million SME holding fund will support more SMEs to grow and to achieve their export ambitions.

Scottish businesses benefit greatly from access to the 500 million potential customers in the European market. Exports to the European Union are estimated to underpin more than 300,000 jobs in Scotland, and we will continue to make a strong case for Scotland to remain a member of the European Union.

Finally, we are developing a new trade and investment strategy for Scotland to replace the existing strategy when it comes to an end later this year. I will say more about the new strategy later. First, I will say a few words about Scotland’s performance.

Scotland has had a strong record of success in recent years in exporting globally and attracting investment. In the three years to 2013, the most recent period for which we have figures, our exports grew by 20 per cent, and we are on track to achieve our target of increasing exports by 50 per cent in value over the period 2010 to 2017.

While I welcome those figures, does the cabinet secretary recognise that, as a percentage share of the Scottish economy, our exports fell?

Jackie Baillie’s position in any debate is always to concentrate on the dreary. Let us agree on the fact that exports are growing—

It is the reality.

Jackie Baillie will have an opportunity to share her miserablism in the debate in a few moments. It is obviously going to be another of those miserable afternoon contributions from her, so we will look forward to that.

In the Ernst & Young Scotland attractiveness survey, Scotland has emerged as the second most successful UK location behind London in attracting foreign direct investment in four of the past five years. Over the past year, SDI helped to attract 91 inward investment projects, which is a 17 per cent increase on the previous year. Those projects will bring £433 million of inward investment to Scotland and will create or safeguard nearly 10,000 jobs.

However, we need to encourage more Scottish companies to internationalise; we need to support Scottish companies to expand into new markets; and we need to prioritise key sectors in which we have a competitive advantage.

Our new trade and investment strategy will set out how we intend, working across Government and with business and the wider public sector, to respond to those challenges. We are taking a rigorous and evidence-based approach to the development of the new strategy, and the committee’s report will help us to formulate those priorities.

Earlier this week, we published a comprehensive review of the data on Scotland’s export and inward investment activity and the factors that are shaping key trends in Scotland and in the global community.

Just as important, if not more so, has been the engagement that we have had with a wide range of public and private sector stakeholders on the new strategy. At the start of that work, I met the chairs of the industry leadership groups in Scotland to discuss the scope of the new strategy. When I attended the cabinet meeting in Oban last month, I had the pleasure of meeting companies from that locality to discuss their exporting ambitions and to hear about some of the challenges that they face generally and as a result of the rural location in which they operate.

We have established a trade and investment strategy partnership of business leaders to act as a sounding board for the strategy. The involvement of partners in developing the strategy will be a key Government priority.

We need to work together to achieve our trade and investment goals, by strengthening the co-ordination of trade and investment support that is provided by the public sector and by building a unique and strong partnership with business and industry. The new strategy will be a key mechanism for responding to the recommendations in the committee’s report, and it will set out actions in response to the Wilson review of support for exporting. We are looking closely at the committee’s suggestions for improving companies’ access to export advice and assistance and information on forthcoming trade missions.

SDI and UKTI already work well together, but we are exploring ways of further strengthening that relationship and achieving better co-ordination of export support across the public and private sectors. In that respect, I agree with the committee that we must look at the issues from the consumer perspective, and ensure that it is clear to individual companies how all the services are related and how they can work on behalf of those companies.

The committee highlighted the potential for enhancing further collaboration between business and our further and higher education sectors, whose networks and connections span the world. Through its involvement in connected Scotland, SDI is working with Universities Scotland and Colleges Scotland to develop initiatives that support Scottish businesses to internationalise while helping the institutions to realise their own international ambitions.

We are considering how we can promote and make better use of the many networks that already exist in Scotland and overseas, including the globalscot network, and we are looking at how we measure and report on the impact of those interventions.

Although a great deal has been accomplished in the development of Scotland’s involvement in exporting and in foreign direct investment, I reassure Parliament that the Government is going through a process, aided by the Wilson review of exporting and the committee’s recommendations, that will lead to the formulation of the updated trade and investment strategy.

That process is important for our gathering together, in consort with industry, the best advice and the best suggestions that we can make to ensure that we satisfy two fundamental objectives: first, that we encourage more companies to become actively involved in exporting and to participate in that activity to the full; and, secondly, that as a consequence of motivating that improvement in participation and performance we improve the external focus of the Scottish economy.

If we do those two things and can use the evidence base that we are now gathering to motivate more companies to participate—of course, that priority is right at the heart of the Scottish business pledge, which is central to the Government’s economic strategy—we will reap the rewards of motivating more companies to be involved in international business activity, and the employment base of Scotland and the economic opportunities of our company bases will be a great deal stronger as a consequence.

14:50  

The internationalisation of Scottish business is a desirable objective that has been pursued by successive Governments over a number of years, but the committee’s inquiry into the matter could hardly have come at a more critical time, because Britain’s membership of the European Union is up for debate, the devolution settlement in the UK is in the process of significant change and, of course, the principle of open borders within the European Union is being tested today as never before.

Not only that, but the Scottish economy itself is facing the challenge of major contraction in the oil and gas sector, which includes many of our most successful global-facing companies and is vital in sustaining a vast and varied supply chain across Scotland and beyond. Oil & Gas UK’s “Economic Report 2015”, which was published this week, reveals that 65,000 jobs have already been lost—many of them in Scotland—and that thousands more are set to go before things get better. The adjustment that is required in the sector is a strong signal of the scale of change that is required across the economy as a whole.

I understand Lewis Macdonald’s obsession with oil and gas, but when we look at the forecasts we can see that they are slightly more optimistic. Why do we not talk about telecommunications, for example, which is the fastest-growing sector and has increased ten-fold over the past 10 years, or about other sectors such as education and utilities? Why is the member so obsessed with what we believe will be a medium-term downturn in the oil and gas industry?

I will compensate your time for that intervention, Mr Macdonald.

That is very kind, Presiding Officer.

That must be one of the most extraordinary interventions that I have ever heard in a debate on the Scottish economy. I stand up to try to account for the 65,000 jobs that have been lost across the UK oil and gas sector—the majority of them lost in Scotland—along with tens of thousands of jobs lost in the region that I represent, and Mr Brodie asks why I am obsessed with oil and gas. That is an extraordinary intervention. I say to Mr Brodie that I am talking about oil and gas precisely because of the critical role that the oil and gas sector plays not just in the north-east of Scotland, but right across the country in the supply chain that stretches all the way from Shetland to the other end of the United Kingdom. I have no doubt that many jobs in the area that Mr Brodie represents are affected by the thing that I am describing.

It is crucial that we understand the importance of that major shock to the Scottish economy, which is happening even as we speak. The extent to which the oil and gas sector and the Scottish economy can withstand the impact of that shock depends to a very high degree on Scottish businesses’ ability to internationalise: to sell, trade and do business in other parts of the world even while facing difficulties in the North Sea.

The committee’s inquiry is, indeed, timely—even as a wake-up call, if nothing else, to members of this Parliament who have not understood what is actually happening in the Scottish economy today. Labour welcomes the committee report’s conclusions and recommendations. We want ministers to go further in doing the same, as I will outline in a moment, because we believe that more needs to be done to overcome the obstacles to the internationalisation of Scottish business.

As a member of the committee, I echo the convener’s tribute to all those who helped with the inquiry, including the committee adviser, Jane Gotts, the researchers and the clerks. I mention in particular the quite exceptional input of Dr Hadi Fawzy and his colleagues in Scottish Development International and UK Trade & Investment on the trade mission to Saudi Arabia—although that visit confirmed, among other things, that the price of oil is unlikely to go back up any time soon.

It is clear at home and abroad that public and private agencies play an important role in sustaining Scottish exports and that, as the cabinet secretary said, SDI and UKTI do sterling work in promoting internationalisation, although it became apparent that they did not always do so in a joined-up way. That is why the committee concluded that there should be a single point of entry for potential exporters that are seeking Government support. Brian Wilson came to the same conclusion in his inquiry on behalf of the Secretary of State for Scotland.

As Murdo Fraser said, it is unclear how the plan to replace the www.business.scotland.gov.uk online portal with a wider Scottish Government site will help to make access easier for potential exporters. Apart from anything, UKTI plays, and should continue to play, a major role in supporting Scottish exports. Anything that impedes access to its support and advice will also get in the way of internationalisation.

The committee also concluded that implementation of the findings of the Wilson review was a matter for both Governments, and for SDI and UKTI, and that the progress of that implementation should be made public quarterly. It is disappointing that the Scottish Government’s response to that simple and sensible suggestion has so far been less than enthusiastic.

Scottish Enterprise, Highlands and Islands Enterprise and business gateway are also parts of the picture. A good example is business mentoring Scotland, which brings potential exporting companies together with business mentors who have already made a success of internationalisation. The committee recommended that companies that are not account managed should be able to receive help with exporting, and that potential exporters should have access to the globalScot network at an early stage. I hope that those things can now happen.

In addition to what the Government can do at its own hand, it needs to be committed to working with other partners. Committee members visited Aberdeen and Grampian Chamber of Commerce to learn from its vast experience of internationalisation. The chamber highlighted two particular issues, which are reflected in the committee’s report. The convener has mentioned the success of the north-east Scotland trade group, which is a model that other parts of Scotland could adapt to their needs.

The second issue that was raised with us by the Aberdeen chamber was the need to join up activity between the public and private sectors better in organising overseas trade missions for Scottish companies. I am delighted that since the committee’s visit, when it heard about some of the difficulties in that respect, the chamber has begun to co-ordinate a joint mission to Mexico, supported by SDI and UKTI. I am delighted, too, that the chamber will help businesses that do not meet Scottish Enterprise’s account-management criteria to join in. That is exactly the kind of joined-up approach that the committee envisages and that deserves the broadest possible support.

Enabling exports is not for Government agencies alone, just as exporting is not just for account-managed, high-growth companies in key sectors of the economy. If Scotland is truly to go global, potential new exporters must have access to an inclusive and co-ordinated system of advice and support from the public and private sectors working together. That is what we want, going forward.

14:58  

I congratulate committee members, clerks and their excellent adviser on the work that they have done and the report that they ultimately produced.

I sat on the Economy, Energy and Tourism Committee during its previous inquiry, in the previous session of Parliament. The main conclusion that we reached was that Scottish Development International was not spending enough of its time focusing on exports. From reading the report and speaking to a number of witnesses, it looks like that position has been reversed and that SDI has taken exports more seriously in this session than it did in the previous one. The results so far are positive.

We should celebrate the fact that, at least in the medium term, the trend for exports for Scottish businesses appears to be very healthy and positive. I got the Scottish Parliament information centre to trace the trends back to 2002. If we take 2002 as being 100 per cent, we are now indexed at 140 per cent, so there has been a good trend of growth. We had a bit of a blip in the early part of the 2000s, when the electronics industry went to its knees, but the trend since 2005 has been upward and positive growth. We should celebrate and welcome that.

I will move on to a couple of areas in which there are still frustrations and where work needs to be done by agencies, the Government, politicians of all stripes and businesses themselves. The first is the lag in the figures that we have, which I know is a source of frustration for the Government, too. At the moment we are celebrating figures from 2013, which are the most recent that are available. That means that when we ask whether we have met the ambitious 2017 target that we set ourselves, we will not know the answer until 2019—two years later. I ask the Government whether there is something that we can do. Are there changes that we can make to get more up-to-date figures and to get a better feel for how exports are going? If we cannot, it will continue to be like trying to drive while looking only through the rear-view mirror.

HM Revenue and Customs’s statistics on exports, which are collected slightly differently from those in the “Scotland’s Global Connections Survey 2013”, suggest that 2014 was not as strong a year as 2013, as we were about £1 billion down in 2014. Although we have figures for only the first two quarters of 2015, if the trend continues for the rest of the year we will be about £1 billion down in 2015 compared with 2014. I hope that those preliminary figures turn out to be wrong, but if they are correct they suggest that the strong growth that we had between 2010 and 2013 has been reversed slightly this year and last year.

Gavin Brown should reflect on the fact that significant elements of the overall exporting and trade position are missing from the HMRC data and the analysis that it undertakes. It is far from a like-for-like comparison with the data and pattern that he set out.

I accept entirely that there are big differences, one of which is the treatment of services, which will have a huge impact. However, the comparison is like for like in the sense that I was comparing 2013 HMRC figures with 2014 HMRC figures. It was like for like in my view, but I accept entirely that the HMRC figures are based on a methodology that is different from that used for the global connections survey figures.

Nevertheless, a £1 billion drop in the HMRC figures from the previous year suggests that there is a fair chance that when we get the global connections survey results in January they will show a drop against the previous year. I hope that I am wrong, but I suspect that I am not.

The second frustration is that although the Government brought in some policies that I supported—smart exporter is one that we argued for in days gone by—it is very difficult to know what impact they have had on the overall figures. Scottish Enterprise, HIE and SDI gave evidence, but they all concluded that it is impossible to tell what impact the policies have had. They were able to say that businesses were satisfied with the training and the courses that were given, but they were unable to tell us what impact they had had on the companies’ bottom lines and exports. I ask Government how we might better evaluate those programmes so that we know which are working and which are not, and so that we can spend more on the ones that work and less on the ones that do not.

The Government response to the report has been broadly positive; it seems to agree with most of what the committee said and is already actioning some of the committee’s recommendations and has agreed to action others in early course.

It is important that we track not just the value of exports but the number of exports, so that we can try to get more companies exporting and reduce our overall risk profile for when some larger businesses suddenly go out of business. We also need to look at greater co-ordination.

The cabinet secretary quoted the number of deals that last year came forward under foreign direct investment. He should be careful about cherry picking his statistics and should look at the statistics as a whole. The report that he quoted shows that the actual number of deals is up, but that the number of jobs created by FDI—in my view, that is the more important figure—is down, and down substantially, for the third year in a row. In 2011 there were 5,926 jobs created by FDI. Last year, we were down from almost 6,000 to 3,500. We used to have 20 per cent of the UK’s FDI jobs, but according to the most recent report we now have 11 per cent. That is a drop of almost half in three years. The number of projects might be marginally up, but it is quite wrong for the cabinet secretary to cherry pick one statistic and suggest that we are doing much better than perhaps we are.

I am content to leave it at that.

We now move to the open debate. Speakers can all have five minutes or thereabouts.

15:05  

Exporting is an important aspect of the Scottish economy. It helps to deliver growth, to maintain employment and to sustain communities. A study called “Export Based Growth: Global Competitive Advantage from the Scottish Brand” by the N-56 consultancy highlighted that Scotland’s exports have been growing and that, in 2013, Scotland’s total trade volume was equivalent to 129 per cent of gross domestic product, or nearly £35,000 per head of the population. The study refers to the 2013 global connections survey, which identified that the value of Scottish exports to the UK and the rest of the world was £99 billion. That gave Scotland a trade surplus of £12 billion, compared with the UK trade deficit of £34 billion.

Despite that, however, the N-56 report acknowledges that Scotland’s export performance

“is lower than average for a small advanced economy and considerably less than the best performing small European trading economies.”

Indeed, although the committee’s report recognises that

“Significant progress has been made towards the Scottish Government‘s target to increase exports by 50 per cent by 2017”,

it also points out that only 100 companies account for 60 per cent of Scotland’s exports. If we are to grow our exports, we have to increase the number of actively exporting businesses in Scotland—especially small businesses, given that less than a fifth of them currently export.

The two key bodies in respect of providing support to businesses that are interested in exporting are UKTI and SDI. However, as the committee report states,

“co-ordination between SDI and UKTI was not as strong as it could be and ... this was limiting the effectiveness of support available to Scottish companies.”

A witness from the Enterprise Research Centre told us:

“From my experience of working with people at UKTI, I can say that they typically regard trade support as having been devolved to the Scottish Government”—[Official Report, Economy, Energy and Tourism Committee, 25 February 2015; c 11.],

and we also heard that the UKTI brand was “pretty much invisible” to most chambers of commerce.

In 2013-14, SDI supported 2,708 businesses across its network of 28 overseas offices, while UKTI with its larger network of 160 offices in 100 countries provided assistance to only 2,300 Scottish companies. Given the larger size of the UKTI network, that suggests that there is a lack of support for Scottish companies.

Gordon MacDonald suggests that the bodies appear to support fairly similar numbers of companies, but he also said that the UKTI brand is completely invisible. Can he explain that?

During the trade mission we heard that some Scottish companies had found the connection to UKTI only by delving into the UK Government website. They did not find it as a result of UKTI’s presence in Scotland.

There is also a lack of co-ordination across the range of organisations, including SDI, UKTI, the SCDI and chambers of commerce, that offer trade missions. The report recommends that SDI be far more proactive in co-ordinating trade missions in order to maximise opportunities for companies, improve co-ordination, avoid duplication and eliminate unnecessary competition between organisers of trade missions.

We also need a single point of information on exporting in order to highlight the support that is available to potential exporting companies. A range of organisations including Scottish Enterprise, business gateway and councils developed the existing online business portal, but although I was able to find topics from cash flows to employment contracts, there was nothing on the opening page that highlighted the topic of exports. It was only when I clicked on “Services”, scrolled halfway down the page and selected “More” that I found any reference to the subject. I suggest that exporting has not been given the prominence that it requires on the website, if the aim is to encourage more businesses to consider exporting.

As part of the inquiry, we visited Forth Ports at Grangemouth. In my view, it has been starved of investment. In order to be able to export more from this country, we require port facilities that are fit for the 21st century. I know that the issue will be debated by the Infrastructure and Capital Investment Committee in the next debate this afternoon.

The SPICe briefing identifies that Scottish international exports have increased by 20 per cent between 2010 and 2013. However, if we are to achieve the 50 per cent increase by 2017, we need to ensure that the correct support is in place to increase the number of exporters, the sectors where we have an exporting presence and the value of all exports. Only then will we achieve the export levels of other small European nations.

15:10  

I welcome the committee’s report, which I read with great interest. I also welcome the Scottish Government’s response, both at committee and in what has been said in the chamber today, because it seems to me that there is general agreement on how to proceed on this matter. We need a simplified landscape and an easy way to take advantage of opportunities. We are a small and internationally respected country, so we have the ability to be fleet of foot and to capitalise on our expertise.

As my colleague Gordon MacDonald outlined, it is essential that, as well as larger companies, small and medium-sized enterprises feel encouraged to be included in the strategy. My view is that there is room for both. In my constituency of East Kilbride, we have successful exporters, large and small. One of the larger ones is Clyde Fasteners, which exports its expertise in engineering and manufacturing across the world. We also have Mentholatum, which operates in the growing chemical and pharmaceutical sector. Further, I am sure that people in the chamber do not realise that Deep Heat, that wonderful product that is used all over the world for all sorts of ailments that I will not go into, is manufactured in East Kilbride.

East Kilbride is uniquely placed within Scotland—as Scotland is uniquely placed within the UK and the world—to capitalise on exports and on a simplified policy landscape.

In East Kilbride, we have a task force—unfortunately, I am not allowed to hear much about it, but there we go; that is for another day—to which I will certainly send the committee’s report and the Scottish Government’s response, in the hope that it will try to capitalise on what I believe is quite an exciting way forward for Scottish exporting.

Lanarkshire has quite a high percentage—11.8 per cent—of Scottish Enterprise account-managed companies and growth company exporters. I was really pleased to see Mr Swinney’s response to oral evidence in which concerns were expressed that, although account-managed companies found it comparatively simple to move forward, it was more complicated to account manage a collaboration of companies. There must be a way in which we can look at sectors and move forward with that kind of collaboration. Mr Swinney talked about companies that are not account managed but which have gone through the business gateway locally and have been identified as having the necessary characteristics and strength to make them successful exporters, and said that SDI’s mandate is to help to support them, as that concerns growth potential.

The idea of a single portal was mentioned quite a lot the report. That is certainly worth looking at. In fact, Garry Clark of Scottish Chambers of Commerce argued that a single point of contact was “absolutely essential”. Certainly, over the years I have heard it said at various business fora that a barrier to the potential expansion of export is the inability to know exactly where to go to access the expertise that is required.

Talking of expertise, I want to raise an issue regarding universities and colleges—colleges, in particular, are mentioned in the committee’s report. It is about how things interact and how we have to get things correct, including interaction with UK Government policy. For example, I am concerned about the fact that the UK Government is preventing international students from working part time while they study here. I am also concerned about the UK Government making students exit the UK before they have time to use some of the expertise that they have picked up through their learning in this country. That is an issue to do with post-study visas. All these things come together.

As far as I am concerned, Scotland’s most valuable export is its people. We should never forget the professionals who have moved abroad with their expertise and are internationally renowned. I do not have time to talk about many, but I am thinking about architectural practices such as John McAslan + Partners, national bodies such as the National Theatre of Scotland, national companies such as our orchestras and our traditional music sector. We send people abroad all the time, and they are part of our export economy. That very much has to be recognised.

15:16  

I am pleased to have the opportunity to contribute to the Economy, Energy and Tourism Committee’s debate on internationalising Scottish business. Like many members, I thank the MSPs who sat on the committee and the staff for their hard work on this important issue.

The world has become more interconnected through the development of high-speed communications and trade. In that regard, Scotland is no different from any other country. Scottish businesses can be afforded genuine opportunities for international expansion through access to world markets, examples of which are listed in the committee’s report. For example, Scotland is the producer of some of the greatest food, drink and textile products in the world, and it is the world leader in such markets as renewables, oil and gas and life sciences. Added to that, Scotland is a key destination for international visitors.

In today’s debate, I will focus on our international visitors. Every member of this chamber is aware of the valuable research that VisitScotland undertakes so that businesses in Scotland can better understand our international markets and keep up to date with trends and developments. Rightly or wrongly, when the term “international visitor” is used, people automatically think of visitors from countries outwith the UK coming to Scotland for holidays, short breaks or cultural or sporting events. There are numerous reasons why international visitors come to Scotland, all of which not only generate economic growth and development in the hospitality industry but have a synergistic economic effect in other manufacturing and service industries.

However, what about international students who come to study in Scotland? Is the student who comes to study in Scotland not also an international visitor, whether they are an undergraduate or a postgraduate student and whether they come from an EU country or a non-EU country? Is Scotland’s education system not also a business? Scotland’s expertise and tradition in the provision of high-quality education could be said to go way back in history. Glasgow, the city that I am proud to represent in the chamber, is a city of education business, and two of Glasgow’s universities have an overseas presence. The University of Glasgow has formed a partnership with Singapore Institute of Technology, and Glasgow Caledonian University has a campus in New York city. The city also proudly hosts the world-renowned Glasgow School of Art.

A key recommendation on page 4 of the report is:

“We recommend that Scottish Development International explore ways to utilise more effectively the extensive international networks established and managed by Scotland’s universities and colleges in order to boost opportunities for Scottish businesses.”

In addition, when Brian Wilson gave evidence to the committee, he advocated the inclusion of an export dimension to any business courses that SDI runs.

Scotland has a wealth of experience in global trade. It has a whole range of networks and support mechanisms that can be called on not only to expand developed markets but to initiate forays into new markets and into countries where markets do not currently exist.

I would urge—I would implore—that investment consideration be given to developing Scotland’s education business. I would also urge the Scottish Government to enact the key conclusions reached by the committee on page 33 of the report to enable our education business to grow efficiently and effectively. That would not only provide untold opportunities for internationalising Scottish business, but bring respect and prestige to our own Scottish institutions as they make their way in what seems to be an ever-shrinking world.

15:21  

The progress made so far in internationalising Scottish business is a success story. That is clear from the committee’s report. Indeed, just because it recommends ways to improve matters does not mean that our internationalisation programme is not a success. As the cabinet secretary said in his response to the committee, the report is “timely”, given that the Government is working on a new trade and investment strategy, which will replace the one that is due to end this year.

The Government has—quite rightly—set itself ambitious targets. That has clearly paid off, with the value of Scotland’s international exports increasing by 40 per cent between 2007 and 2013, from £20 billion to almost £28 billion.

I am very pleased that the internationalisation of Scottish business is a central aspect of the Scottish Government’s economic strategy. I was pleased to see that one of the six key actions in the strategy is to encourage small and medium-sized enterprises in particular to develop “a more export-orientated focus” to their business.

Support for SMEs was a theme in the evidence that we heard, and the convener’s summary of the committee’s recommendations touched on a number of suggestions with particular relevance for SMEs. Obviously, the single portal will appeal to them; smaller businesses also have much to gain from sectoral approaches to exporting, with food and drink being an ideal example that other sectors can follow.

The cabinet secretary highlighted in his speech the measures that Government has taken to support exporting by SMEs. I was pleased to note that the number of businesses that receive SDI support has increased from 2,194 in 2010 to 5,388 in 2014. Clearly, progress is being made.

A particularly important recommendation in the report relates to improving how the Government captures data. The committee said that SDI

“should capture ... the increase in export sales ... by companies as a result of participation in its ... programme.”

The Government agrees, which is good. I also think that the Government should publish data showing export performance by sector, company size and region.

The inquiry shone a light on patchy performance across the regions when it comes to exporting. I was more than a little dismayed to learn that my region of Dumfries and Galloway had only 1.8 per cent of Scottish Enterprise’s growth exporting companies, which is the lowest of all the regions. The Lothians, for example, topped the list with 20 per cent. Even a more comparable area such as the Borders had 3.5 per cent of the growth exporters—a figure that is double that in Dumfries and Galloway.

As the cabinet secretary knows, I have taken those figures to Scottish Enterprise and have raised them with officials in public evidence sessions, to see how we can address the issue. I am pleased that as a result of that lobbying, Scottish Enterprise, at a high level, has committed to working closely with business gateway locally to improve support, because not all companies can become account managed, and companies in the south-west area do not tend to reach the size that would trigger such support.

The Scottish Council for Development and Industry and Scottish Chambers of Commerce echoed the concern that not all companies would get the export support that they needed if they fell outside key areas that were not account managed. Iain McTaggart told the committee that

“we need to recognise that there is export potential in other companies that are excluded”—[Official Report, Economy, Energy and Tourism Committee, 18 February 2015; c 11.]

from the account-managed network, and that we need to think about ways to address that.

The evidence that we heard highlighted the fact that, in the Highlands and Islands Enterprise area, companies with a lower turnover than those in the rural areas of the SE network—such as Dumfries and Galloway—met the criteria for help. However, Jane Martin of Scottish Enterprise told the committee that she was working with the local authorities in the south of Scotland. I confirm that, and I am pleased that she is committed to assessing companies on the basis of potential and opportunities for growth, as opposed to just using a threshold, which, as she said herself, is a bit of a blunt instrument.

I was very pleased that the cabinet secretary repeated that when he came to the committee. He said that, if the business gateway identifies smaller companies

“as having the necessary characteristics and strengths that could make them successful exporters, SDI’s mandate is to support those companies. That is about identifying growth potential.”—[Official Report, Economy, Energy and Tourism Committee, 25 March 2015; c 37.]

That is all welcome. I certainly welcome it.

As well as providing recommendations to Scotland as a whole, the committee inquiry resulted in me getting useful material to take forward in my region. I hope that we can get more support for the companies that operate there. I shall, of course, talk to local business, councils and enterprise agencies to ensure that the progress that has been promised as a result of some of the issues that came out during the inquiry makes a difference on the ground.

15:27  

As we all know, Scotland is well known all over the world for certain original and iconic products. Whisky, tartan and bagpipes are examples. Therefore, in many ways, Scottish business does not need to be internationalised, as it is already well known.

I have travelled all over the world many times selling Scotland and appeared at many trade shows under the British flag—I emphasise that it was under the British flag—so I know how important Scotland is to the world. We did not hide our Scottishness. In fact, we were proud of it and the saltire featured heavily on our stand, as did the thistle, which was my particular international brand. It was a black thistle on a red background, which is recognised in fine textile shops all over the world.

My business was selling tweed, tartan and cashmere. Selling it under a Scottish brand proved to be very rewarding. Nothing made me more proud than to see the made in Scotland sign displayed everywhere. Of course, it was always easy to sell quality and that, not quantity, is what Scotland is known for. Every time that quantity was due to be sold, we failed. Many of the small textile companies in the 1950s and 1960s that sold T-shirts and cotton perished under increased competition from our far eastern friends and our European neighbours.

Scotland has a brand that needs marketing and market it we did. I led and participated in many trade shows in Europe and the east. With a name like Cameron Buchanan, I could not be taken for anything other than a Scot.

I was leading a trade show on behalf of what was then UK Fashion Exports coupled with Scottish Trade International. We had a big stand at the Hilton hotel in Osaka, Japan, and it was a very hot afternoon. The company at the stand next to me—I think that it was called the Swilken Golf Company—was selling custom-made golf clubs. It had developed a golf club that perfected your swing so that when it came to swinging the club, you could ramp it up with clicks depending on how you swung the club.

Unbeknown to me, some friends had ramped up the numbers so that it was necessary to swing the club really hard to get the click going. Nothing happened for the first two or three swings, so I gave it an almighty swing and the club left my hands and shot straight up to the ceiling, smashing a huge crystal chandelier. I was mortified. Everyone else laughed, as I thought that it was thousands of pounds worth of damage. It was a hot day and the club just slipped out of my hands. However, I was lucky because the show was covered by international insurance. I was pleased to see that.

That evening, as I was making a speech, I was presented with the aforementioned golf club and the Japanese people, who found it very funny, said, “Mr Buchanan this is for your hole in one.” From then on, every time that I got up to speak they all shouted, “Fore! Fore! Fore!” A lot of humour was involved and Scotland then needed very little internationalising.

I value the Scottish brand greatly, and with a brand comes the business. What we sometimes think of as just another piece of fabric or, in the case of bagpipes, a noise or, in the case of whisky, a drink can prove to be a very valuable product.

Whisky is a particular case in point. We see brands in other countries that never appear in the UK, and not all of them are counterfeit. I issue a word of warning. We need to be careful not to spread ourselves too wide and produce a whisky brand like the one that I once saw in Taiwan called “Scottish Kicker”, which in Chinese had been misspelled as “Scottish Knicker”. The brand consultant could not understand why everybody laughed when he produced a whisky bottle with that label. It was only when it was pointed out to him that it had a totally different meaning that was not considered to be very relevant to whisky that he hastily had to relabel 4,000 bottles. It served him right.

If we are to make sure that we are successful, we must be proud of our country and proud of our achievements. We in Scotland are so lucky that we do not realise it. Many other countries are envious because of what we have. In particular, they are envious of our internationally recognisable symbols. After all, why would people like Donald Chump—I am sorry; I mean Trump—come over and build a golf course in Scotland and not in France? It is because we have scenery that is second to none and we promote our country in the right way. We even have weather of which the Welsh golfer Ian Woosnam once said that we have all four seasons in one golf swing.

We do not need fancy embassies or consuls—well, maybe we do need consuls—all over the world in order to internationalise our business. We should just be proud of what we have.

We have another iconic brand in Harris tweed, which was registered as a brand in 1951. When people speak of tweed, which, after all, is the name of a river in Scotland, they think that all tweed comes from Harris, whereas most of it comes from Lewis and the name originally comes from Holland. Notwithstanding that, Harris tweed is a hugely successful export, and that is because we have registered the trademark with its orb and sceptre. It is a brand that is internationally well known and respected. The aforementioned Brian Wilson is chairman of one of the companies up there.

You can bring your remarks to a close any time now.

Scottish silver is also well respected and valued, and the Scots have excellent original products. We have only to go to Hong Kong to see international firms such as Jardine Matheson and Hutchison to realise that they originally came from Scotland. Let us appreciate what we have and shout about it with pride.

Thank you, Mr Buchanan. That was definitely the most entertaining speech of the day.

I call Jackie Baillie. You have five minutes. Follow that.

15:32  

We traded statistics on Tuesday, when we debated the Scottish Government’s economic strategy, and I have no doubt that we will trade them today. I say as gently as I can to John Swinney that to do so is not to be miserable—I am one of the happiest people I know; at least, I thought that until I listened to Cameron Buchanan—but to inject a note of reality into the cabinet secretary’s fairytale. I notice that when John Swinney does not like what I say, he resorts to insulting me.

Imagine that.

I take that as a compliment, because it is the hard truth in what I say that makes Mr Swinney quite so miserable.

It is important that we understand the context of the debate. According to the Government’s statistical bulletin, we export some £27.9 billion of products and services abroad. That might be an increase in cash terms, which is to be welcomed, but it represents a decline in our export market as a percentage of the Scottish economy. If I read the graph in the SPICe briefing correctly, it is a decline from 24 per cent to something like 17 per cent. Although that is not a positive sign, it suggests that there is potential to improve, and I urge the cabinet secretary to look at that and to try to increase exporting’s share of the Scottish economy.

About 100 companies account for 60 per cent of our exports. There is less awareness of and engagement with exporting among SMEs. That is another area in which there is potential to improve.

Our largest international export market is the United States and just under half of our exports are to Europe, but our largest export market overall is the rest of the UK, which is worth at least £46 billion to our economy each year and accounts for about 65 per cent of all our exports. Many of us recognise the importance of the European Union for our businesses and for growth in the economy. We know that removing barriers to trade is valued by businesses in Scotland. I welcome the Scottish National Party’s positive view of Europe, which I share, but I cannot help but observe that those arguments were exactly the same arguments that were deployed during the referendum as good reasons for staying part of the UK.

Let me move on and touch on inward investment. Becoming more international in our outlook is not just about securing more exports; it is also about getting foreign countries to invest in Scotland. Although there are increases in inward investment and they are improving—that is welcome—we need to make the connection with jobs. There is more mixed news on that. Inward investment may be increasing, but it is creating fewer jobs. To echo what Gavin Brown said, there was a fall of around 15 per cent in that figure in 2014 compared with that for 2013. Indeed, the 2014 figure is the lowest since 2009, and 2014 was the third consecutive year of decline. Everything that we do should be about adding value to our economy. We should focus on inward investment, but as a means of creating jobs.

Gavin Brown was quite right: the cabinet secretary should not cherry pick his statistics. If we are to understand how we are to improve things, we need to understand the totality of the picture.

As an aside, I note that Mr Brown was not accused of being miserable. I look forward to the day of equality in the Parliament.

That will be next week.

I do not take interruptions from a sedentary position.

A number of members have mentioned the Wilson review, which reported in May last year. In his final report, Brian Wilson made a number of recommendations, many of which find an echo in the committee’s report. I commend those to the Scottish Government. One of the key issues was the institutional clutter, which causes confusion, as there are different providers of advice, information and support. We need a one-door approach if our efforts are to be well focused. We also undoubtedly need better collaboration between Scottish Development International and its UK equivalent for the benefit of employers.

I noted the First Minister’s announcement of the creation of three innovation and investment hubs, in London, Brussels and Dublin. They, too, are welcome, but I would like to know how they sit with the network of 28 overseas offices that SDI already has.

I join others in congratulating SDI on the rapid increase in the number of companies that it supports. I am sure that the cabinet secretary agrees with the committee when it talks about giving it even more challenging targets to meet.

The cabinet secretary has a target to increase exports by 50 per cent to 2017. That is an ambitious target, but we should be ambitious.

I have heard it all today. We have heard about golf, knickers, kickers and Donald Chump, not Trump. We have in our midst an escapee from the Edinburgh festival. I think that Mr Swinney and I can agree that Mr Buchanan’s speech was a wonderful and amusing interlude.

15:37  

If there is one thing that we have learned from the debate, it is never to invite Cameron Buchanan to a game of golf on a golf course. If someone does so, they should ensure that they are wearing a hard hat, at the very least.

I welcome the contributions that have been made by members across the chamber to a very instructive and informative debate. As other members have done, I thank the committee and the clerks who were involved in producing a report that I know we have studied extensively across the Government and broadly welcomed.

I am similar to Cameron Buchanan in one sense. I have travelled the world. My job is by far the best in the Government, as I have the job of selling Scotland across the world. In one sense that is an easy job to do, because people have very positive associations with the country. I have noticed something in the three years in which I have been in the role. When I initially went to some of our new and emerging markets, Scotland was known for some of the more traditional things, such as golf, castles, great scenery and the Loch Ness monster. People knew about them. Having travelled back to those countries, I have noticed that people have more of an interest in and more of an understanding and knowledge of some of our produce, such as whisky and salmon, and they have more of an understanding of our global companies, such as Aberdeen Asset Management, and of our areas of expertise, such as oil and gas. I think that that is down to the great agencies and much of the good work that has been done—

I forgot to say that food is very important nowadays, and Scottish food has really come on to the market. Everybody talks about Scottish food and Scottish produce, which was not the case 20 years ago.

I was not doing this job 20 years ago, but I accept entirely what Mr Buchanan says.

Today’s debate has provided an opportunity to reflect on many of the factors affecting the ability of Scottish companies to internationalise, and on Scotland’s areas of strengths and areas in which there is room for improvement. We have heard about success stories and about companies that have grown their business by expanding into new, international markets. We have also heard about the challenges and frustrations that seem to be a common thread for many businesses, particularly small and medium-sized enterprises, as many members have said.

Before commenting on those, however, I want to return to Scotland’s export performance, to reiterate that the picture is generally positive. There is room for improvement undoubtedly, as many members have said, but the general picture is positive as we move forward. Scotland’s total exports of goods and services, excluding oil and gas, grew by almost 70 per cent between 1998 and 2013, from £38.8 billion to £65.7 billion in cash terms. We are on target to meet the 50 per cent target that has been mentioned, and I have to tell the ever effusive and complimentary Jackie Baillie that she should not take Mr Swinney’s criticisms at all personally. As used to happen in the school playground, perhaps we tend to insult the people whom we actually really like.

That is a stretch.

Perhaps he does it only because he likes her. Exports as a percentage of GDP are—

Will the minister take an intervention?

I think that I will, actually.

I have to say that the cabinet secretary’s face tells a different story.

I cannot comment on that. However, on the point that Jackie Baillie raised, I would be interested to see her statistics, because exports as a percentage of GDP have increased in recent years, from 46.3 per cent in 2006 to 48.9 per cent in 2013.

I agree with the general sentiment that has been expressed in the debate, that too few companies are exporting to too few geographies. However, the committee’s report also rightly drew attention to the fact that the number of SMEs is not high enough. Sixty per cent of the total value of Scottish exports in 2013 was generated by just 100 companies; that statistic has been repeated time and time again. In addition, Scottish exports to emerging economies remain low relative to what they should be. Our economic strategy made clear that more needs to be done to encourage a more export-orientated focus across all companies and sectors in Scotland.

I want to address one or two other points that have been raised. Gavin Brown mentioned the lag in statistics, and we share his sense of frustration. The point was well made and it is one that we can certainly reflect on. The global connections survey gives a full assessment of the statistics produced, and it takes time to make such a full assessment, but I agree that we should see what more can be done.

In response to the committee’s recommendations, there are four areas that I want to whiz through. The first is about encouraging more Scottish businesses to internationalise, which requires close collaboration across the public and private sectors. Murdo Fraser spoke about that in his opening remarks, and Linda Fabiani touched upon it too; he was right to mention Scotland Food & Drink, which is a good example of how the private sector and public agencies have worked together collaboratively with great success. We saw some of that success played out in this week’s statistics, so we need to co-ordinate the contributions made by a range of different organisations that are involved in helping Scottish companies to internationalise and identify ways of encouraging more business-to-business support.

The committee drew attention to the North East of Scotland Trade Group, which Murdo Fraser mentioned the committee had met, and its report suggested that similar regional export partnerships might be developed. SDI is certainly looking to do that.

Although many Scottish companies successfully access the high-quality advice and support that is available, some companies struggle to find that information, and virtually all members have asked how companies can get better access to that information and how we can ensure that the information is better co-ordinated at one central point. I agree that SMEs can find that information only if they know where to look, so perhaps the Government and SDI should reflect on how, even though a one-stop shop exists, we can reach out to SMEs through Business Gateway or by other means so that companies know where that support is available. Murdo Fraser used the word “cluttered”. That is something that we recognise, but I am pleased that progress is being made through our portal and through mygov.scot.

I agree that we need to make more of our assets, that is to say our people, including the global Scots across the world and the many people who have passed through our universities and educational institutes and who have some affinity to Scotland.

I thank committee members for their recommendations. I think that everyone who participated in the debate will reflect on what has been said. We welcome the report and will work closely with UKTI and other public agencies to ensure that we take full account of what the committee said, to ensure that Scotland can better position itself globally and market itself across the world.

15:45  

I welcome this short Economy, Energy and Tourism Committee debate on internationalising Scottish business and I commend Murdo Fraser, the committee convener, for the way in which he led the inquiry.

We cannot be complacent, and I will talk about the conclusions that the committee arrived at, but we are having this debate the day after it was announced that Scotland exported £14 billion of food and drink in 2013. As Jackie Baillie said, we shipped £27.9 billion of goods and services overseas, which she translated into a GDP figure without including the impact of exports to south of the border.

As I said during last week’s debate on the programme for government, if there is one subject about which I am particularly passionate, it is Scotland’s place on the international stage. Consequently, I am passionate about Scotland’s strategy for trade and investment around the globe. My interest was perhaps stimulated when I was a young manager responsible for the international distribution of NCR products from the company’s Dundee manufacturing plants. The thrill of shipping four class 395 electronic accounting machines from Dundee to Honduras in exchange for a container-load of bananas was palpable. Who knows what might have happened last September if we had involved bartering and bananas in our currency discussions?

Other members share my great interest in the subject. I hope that you will forgive me, Presiding Officer, for declaring that I regret that today’s two debates are curtailed. They are not mutually exclusive, and I am sure that members who speak in the Infrastructure and Capital Investment Committee debate will make the point that Scotland’s international business growth and exports to Europe cannot largely depend on one major route to Europe—the channel tunnel. Members might also point out that our international aspirations cannot be contingent on carbon emissions-heavy activities such as haulage, with Scottish goods travelling down the M6 to Heathrow, Gatwick and Dover. Hence there was a proposal some weeks ago—which you will appreciate, Presiding Officer—to fly seafood and perishable goods out of Prestwick airport and other outlets, at not much greater cost than that of transporting goods by road, to retain our markets and customers.

Let me return to the committee’s recommendations and to the speeches in the debate. In a thoughtful and thought-provoking speech, Gavin Brown was right about the need for accurate data. Linda Fabiani surprised me: I thought that East Kilbride was famous for Coca-Cola, not Deep Heat—I have a totally different view of East Kilbride now. Joan McAlpine was right to focus on regional disparities in the economy. I say to Cameron Buchanan, who talked about specialisation and product focus, that I played golf with the Chinese consul at Turnberry at the weekend; I did not break any chandeliers, but the way in which I played broke my heart.

I met senior members of Scottish Enterprise and Scottish Development International last week to talk about regional disparities and the need for more emphasis on south-west Scotland, which Joan McAlpine mentioned. That conversation, like previous ones, left me in no doubt about the agencies’ dedication to achieving the objectives on internationalisation that I think will be set out in the Government’s new trade and investment strategy, which will not just focus on the products and service sectors in which we excel but relate sectors directly to the geographical markets in which opportunities for us are crystallising.

The recommendation that the agencies review the criteria for account-managed status, with a greater emphasis on companies’ export potential, is critical. That is particularly the case given that a recent Scottish Chambers of Commerce survey found that 65 per cent of non-exporting companies thought that they did not have suitable products or services to export.

Who knows? With appropriate promotion and marketing, and the involvement of the various trade missions, we might be able to capitalise on the huge opportunities that exist overseas.

Account management support is critical to companies that can and wish to export. However, the varied roles of agencies such as business gateway, the chambers of commerce, the enterprise agencies and other bodies that are interested in exporting are somewhat confusing. The situation needs to be rationalised and focused and, as the cabinet secretary said, SDI needs a mandate and a greater role in overseeing all companies that might and can become successful exporters.

In the committee’s opinion, that would enhance the increased focus on internationalisation. The total number of exporting businesses has already increased from 2,194 in 2010 to 5,388 in 2014 and we welcome the Government’s response that it will recognise internationalisation as a key driver for growth and that Scottish Enterprise will bring more companies into its international account management services.

However, as per the committee’s recommendation, that can be achieved only through the use of experience in and knowledge about exporting. Along with advice and help from the proposed mygov.scot website and the use of good experience and data, we can be successful.

For example, how many of our potential exporters know that the main destinations for Scottish exports in 2013 were the Netherlands, Germany, France, Denmark and the USA and that 50 per of all our exports went to the European Union? I refer to my earlier comments about having one single artery. Within the £14 billion, the largest growth in monetary and percentage terms involved exports to Denmark, believe it or not. Perhaps we can learn from what we are doing differently there—that may relate to different products and what have you.

Other growth markets provide product and service demand as well as market intelligence that is aligned to products and services and which has to be the basis of advice from our internal analysis and from external networks such as the globalscot network. Advice about our innovations and aid and engagement with international partnerships are also essential.

There is agreement that even closer relationships or partnerships between SDI and the overseas campuses of our universities and research centres are desirable, if not critical.

The committee recognised the need to change the enterprise culture in Scotland, to promote the opportunities and to measure the framework of improvement. Many aspects of exporting are healthy in terms of what the committee recommended and the Government’s response to that. I am pleased to support the Economy, Energy and Tourism Committee’s recommendations on internationalisation and I acknowledge the Government’s will in response to those recommendations.