Scottish Cities Alliance

To kick off Scottish Cities Week, Councillor John Alexander, chair of Scottish Cities Alliance and leader of Dundee City Council, comments on a year of strong inward investment activity in Scotland, galvanised by a series of City Region Deals.

A vital part of any country’s economic development, inward investment into the UK has been impacted in recent years by political and economic uncertainty, with rising inflation and soaring interest rates giving many investors pause for thought.

Despite this, Scotland has seen a significant inflow of capital from overseas, one that is the envy of the rest of the UK. Research by consultants EY found that foreign direct investment into Scotland rose by 14% in 2022, outperforming the rest of the UK and the EU by a considerable margin.

Scotland’s efforts to attract inward investment are supported by its network of cities – Aberdeen, Dundee, Dunfermline, Edinburgh, Glasgow, Inverness, Perth, and Stirling – which, represented by the Scottish Cities Alliance (SCA), work collaboratively with the UK and Scottish governments to create the right conditions to attract the overseas investment community.

Playing a major part in Scotland’s successful inward investment efforts are a series of City Region Deals (CRD). These agreements between the UK Government, the Scottish Government and local partners are designed to foster long term investments in Scotland’s towns and cities , unlocking their potential and leading to sustainable economic growth and the creation of tens of thousands of jobs.

CRDs are resulting in around £5 billion of investment across the country, with projects underway from Inverness to Edinburgh, Aberdeen to Glasgow. In addition to the numbers showing Scotland is bucking the trend when it comes to foreign direct investment, the live working examples suggest the CRDs are proving highly successful.

Glasgow’s CRD is one of the UK’s largest, with CRD-supported infrastructure projects progressing well throughout 2023. One of those is the new active travel bridge over the major artery, the M8, opened in March this year. Connecting Sighthill, the nearby city centre and local communities in north Glasgow, the bridge is a key feature of the £250m regeneration of Sighthill, supported through the CRD by a £38.6m investment from both the UK and Scottish governments.

In Inverness, the new Life Sciences Innovation Centre at the city’s University of the Highlands & Islands (UHI) Campus was officially opened in March, paving the way for the development of new treatments, services and products, adding to the region’s existing life sciences cluster. The centre was jointly developed by Highlands & Islands Enterprise and UHI, backed by £9m from the UK government as part of the Inverness and Highland CRD.

The Port of Aberdeen’s transformational £420m expansion project at the South Harbour, supported by £12.5m from Scottish and UK governments through the city’s CRD, opened in September. Independent analysis suggests that when the expanded port reaches its full potential its Gross Value-Added contribution will jump 60% to £2.4bn and increase job numbers by 45% to create 17,500 roles.

In Stirling, the National Aquaculture Technology and Innovation Hub had its full business case endorsed by UK and Scottish governments in October. Led by the University of Stirling and supported by £17m from the UK government through the Stirling and Clackmannanshire CRD, it will use the latest research to tackle major challenges facing aquaculture producers, such as fish welfare and environmental impacts, to ensure the UK leads innovation of the aquaculture industry.

The Edinburgh and South East Scotland City Region Deal (ESESCRD) has progressed with the opening of the Edinburgh Futures Institute. Developed by the University of Edinburgh alongside communities, industry and government, it transformed the Old Royal Infirmary into a multi-disciplinary collaboration space for learning, research and engagement. Another project, the £40m Edinburgh Innovation Hub delivered in partnership between Queen Margaret University and East Lothian Council, has seen a new junction created off the A1, providing access to the Hub and its surrounding area. Once opened, it will focus on high growth sectors with specialist needs, including the food and drink sector.

Meanwhile, Dunfermline has been awarded almost £5m from the Scottish Government’s Housing Infrastructure Fund through the ESESCRD. This has helped unlock strategic sites for the delivery of up to 2,000 affordable homes in the city. Dunfermline has also seen the development of new industrial units as part of the Fife Industrial Innovation Investment Programme (i3), where site servicing has unlocked major private sector investment. There has been significant interest in the new Council-built units, completing in Autumn 2024.

Last but not least, Dundee’s ambitions to grow the Tay Cities Biomedical Cluster are progressing with a series of new projects establishing the city as an important innovation centre. Supported by a £25m Scottish government investment through the Tay Cities’ CRD, the cluster is expected to create nearly 300 new biomedical jobs by 2033, rising to 800 new jobs by 2053, while adding more than £190m to the local economy by 2053.

Such projects help create the conditions necessary to attract inward investment. They illustrate the positive impact that CRDs, together with the collaborative work of the SCA, the Scottish and UK governments and local partners, are having on Scotland’s economic present and future. With our unique approach, we trust Scotland will continue to stand out as an investment destination on the world stage.

Councillor John Alexander is Chair of the Scottish Cities Alliance and Leader of Dundee City Council.

Scottish Cities Alliance is a partnership of Scotland’s eight cities and the Scottish Government working collaboratively to attract investment and deliver sustainable economic growth. Scottish Cities Week is part of this collaboration and will bring together City Leaders and senior officers of partner cities, investors, developers and other organisations for a series of events in London this week to facilitate conversations and showcase the economic ambition of the Scottish cities

Scottish Cities Alliance’s Councillor Alexander on supporting inward investment ambitions | Insight | Property Week