2016 preview: the view from Scotland

We continue our 2016 preview by asking Simon Innes, managing director of Goodson Associates and ACE Scotland chair which three things he is most excited about and what he sees as the biggest risks.

The three things that I am excited about are: - 

Scottish Government Elections - Following on from the overwhelming increase in the number of SNP members of the UK parliament, it will be interesting to see how this is reflected in the AMS form of proportional representation for the Scottish Government elections in 2016. This will allow businesses in Scotland to look forward into the next five years and even beyond. However, the uncertainty surrounding a UK European vote and the ongoing  doubt about another Scottish independence vote, which could follow a UK decision to pull out of Europe, will hang over decisions for inward investment in the Scottish construction community. A strong and stable devolved Scottish Government will act in the best interests of the businesses of Scotland.

World Economy – Specifically the effects of the world economy on Scottish construction cost. Following a number of years of stagnant construction costs in Scotland, tender costs increases have been unpredictable and sporadic. Effects of the massive reduction of the cost of the barrel of oil also significantly changes the construction industry landscape within the country. This unpredictability further restricts the opportunity for private, and indeed public, development in construction projects. There is a significant need for private sector developers to be allowed to invest in major development projects. Stability in construction costs are required to complete these development deals.

Forth replacement crossing completion - Following two iconic bridges across the Forth, the whole country is eagerly anticipating the opening of the Queensferry Crossing. This is the continuation of a huge investment in infrastructure by the Scottish Government. The members of the public crossing the current bridge (when it is open!) have marvelled at how this tremendous civil engineering structure has grown out of the sea and is continuing to reach out its hands to link Fife with the Lothians.

And the risks . . . 

Europe - Without a doubt the biggest risk for 2016 is the Europe question. The Scottish economy needs the link to Europe to facilitate growth. The pan-European nature of the oil industry, the alternative energy market (wind and wave) and the commercial banking industry is fundamental to Scottish industries.

China - The effect of the downturn in the emerging markets around the world has a real effect on the stability of the construction industry within the UK. The lack of inward investment from The East, Middle East and Russia will significantly restrict the growth in the market.

Resources - The lack of trained construction personnel at all levels within the implementation and design sectors of the industry will stifle the growth of the industry and indeed the growth of the country as we struggle to deliver the housing and infrastructure improvements required to support the country.


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