Sturgeon welcomes proposal that would help fund SMEs and strategic projects
Please use the sharing tools found via the email icon at the top of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
https://www.ft.com/content/daea9cd4-1c8b-11e8-aaca-4574d7dabfb6
Scotland has announced plans for a £2bn national investment bank to support smaller businesses and strategic projects with “patient” long-term funding. Nicola Sturgeon, first minister, welcomed proposals on Wednesday for a government-owned bank to be in operation by 2020. “The time for debating whether or not this is a good idea has passed, it is now time to get on with making it happen,” Ms Sturgeon said. “We are determined now to move at pace.” The Scottish National party sees the investment bank as an important way of boosting Scotland’s anaemic growth rate, which has lagged well behind that of the UK as a whole in recent years. Under proposals drawn up for the Scottish government by Benny Higgins, chief executive of Tesco Bank, the investment bank would fill a “gap in the market” for loans of £1m to £10m to small and medium-sized enterprises with high growth potential. The bank would also help fund, possibly through direct investment, projects that aim to promote innovation to tackle “grand challenges” such as carbon emission reduction or artificial intelligence, Mr Higgins said. With capital of £2bn — equivalent to about 1.3 per cent of Scotland’s gross domestic product — the bank would have the “scope and scale to be transformational to the Scottish economy”, the proposal said. Mr Higgins cited Germany’s KfW as an example of the economic contribution a state investment bank could make.