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33,000 Scottish businesses showing signs of financial distress as Covid-19 restrictions continue

The number of businesses in financial distress in Scotland is continuing to soar, with almost 33,000 experiencing early signs of distress in the final quarter of 2020.

This 30% increase compared with the same period the previous year comes as the country faces a strict lockdown which is likely to remain in place until at least February.

The latest data from business rescue and recovery specialist Begbies Traynor showed a 14% rise in those seeing ‘significant’ distress since the third quarter of 2020, slightly above the UK wide figure of a 13% increase.

In contrast, the country experienced a 40% fall in businesses experiencing ‘critical’ distress – those that have had winding up petitions or decrees totalling more than £5,000 against them – by the end of last year, compared with the same period the previous year.

There was also a 19% fall in these advanced signs of distress in

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Edinburgh is the UK city that has faced the least economic impact from Covid

Edinburgh is the UK city least impacted economically by the COVID-19 pandemic,while Glasgow is the hardest hit city in Scotland.

The latest Demos-PwC Good Growth for Cities report suggests the Scottish capital is expected to see its economy shrink by minus 9.1% in 2020, a less severe impact than in any other UK city, due to its sectoral mix and relatively low case rate.

In Glasgow, the economic decline in 2020 is expected to be minus 10.4%. By contrast, the average annual economic growth rate for cities in Scotland is minus 9.7% in 2020, better than the UK average rate of minus 11.0%.

The economic recovery profiles north and south of the Border are more similar, with Aberdeen’s economy predicted to grow by 4.1% this year, and Glasgow by 4.6%. With 3.9% growth forecast, Edinburgh will be one of the slowest cities to recover.

The Demos-PwC Good Growth for Cities

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Sir Ian Wood appointed to key body seeking to rebuild the UK economy after Covid-19 pandemic

Sir Ian Wood, Chairman of Opportunity North East and former Wood Group Chairman has joined the UK Government’s ‘Build Back Better Council’ which met for the first time yesterday.

A veteran of the energy sector, Sir Ian said he would “take this opportunity to champion the huge potential in energy growth and development and the crucial role that Scotland can play in Building Back Better.

“Whilst we must not underestimate the potential impact of the pandemic upon our region, there is cause for optimism as we begin the new year and Opportunity North East (ONE) will play its role in meeting these challenges.”

He continued: “ONE and its partners have a clear ambition to transform Aberdeen and the North East of Scotland into a globally integrated energy cluster, focused on accelerating to net zero by 2050 through developing energy transition activities.

“This includes the Energy Transition Zone, the Aberdeen

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Brexit delays for fishing sector are “teething problems” – Cabinet Minister claims

Delays to fishing exports are just “teething problems” following Brexit, Foreign Secretary Dominic Raab has claimed.

Challenged about the warning from the seafood sector that fishing businesses could collapse within days, Raab said he was “not convinced” it was because of the Government’s trade deal with the European Union.

Speaking on the Andrew Marr Show on Sunday morning, Raab argued the trading agreement will “create huge, sustainable opportunities” for the fishing sector.

Exports of fresh fish and seafood have been severely disrupted by delays since the UK’s transition period ended on 31 December.

Some Scottish fishermen have been landing their catch in Denmark to avoid the “bureaucratic system” that exports to Europe now involve, according to Scotland’s Rural Economy Secretary Fergus Ewing.

On land, lorries transporting freshly-caught produce have been held up at distribution hubs and many have struggled to enter into France – a situation which First Minister Nicola

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Bank of England working to spread Covid shock and avoid economic “chaos”

The governor of the Bank of England has told Scottish business leaders it is trying to spread the shock of the coronavirus crisis, so that the economic downturn does not lead to chaos.

Speaking in a webinar with 190 members of the Scottish Chambers of Commerce, Andrew Bailey indicated that a continued UK recession was likely this winter.

He warned the UK economy was in “a very difficult period” and the trajectory for any recovery would be revised in the central bank’s February forecast.

Bailey said that unemployment was probably closer to 6.5% than the official 4.9% UK rate from the Labour Force Survey.

Quantitative easing will continue, with a further £150bn of asset purchases to be spread through this year, in addition to the £300bn made last year.

Bailey also noted a possible move to negative interest rates, stating that they had not been tried anywhere in the

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January 2021

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