In this next instalment of our Looking Ahead with Livingston James series as part of our 10th anniversary celebrations, we hear from James Withers, Chief Executive of Scotland Food & Drink, on the challenges Scottish food and drink has faced, and what the future holds for the sector.
Challenges of the Last Decade
Food and drink has become a national success story in Scotland. It was little over a decade ago that the sector was pretty static in growth terms. Scotch whisky was bursting into a new phase of growth, but most of the rest of the industry remained flat. The sector was an afterthought in economic terms, dwarfed by a focus on financial services and oil and gas.
In the last decade, food and drink has been the best performing sector of Scotland’s economy (now worth £15 billion annually) and its fastest growing export (heading towards £7 billion in sales). Interestingly, the growth in food manufacturing in Scotland, between 2008 – 2017, was twice the rate of the UK average for the sector. In other words, something different and exciting has been happening in Scotland.
The secret recipe for success really isn’t that secret. It has been about a ruthless focus on opportunity, a unique partnership between the industry and government in Scotland and the building of reputation and new markets. Food exports have doubled. We’re now doing six times as much business in the Far East as we were a decade ago, three times as much North America and twice as much in Europe. At home too, food and drink has gone from being something of a deep-fried joke to being a source of national pride. Sales of Scottish brands across the UK have risen and, at home, we’re finally understanding the enormous potential of food tourism.
Of course, there is still so much to do. Our farming industry is yet to see food and drink success translate into greater confidence and profitability. The health of our nation needs improving further. We need an ever stronger culture of innovation and internationalisation across our food and drink industry. And the state of emergency surrounding climate change is going to define the next decade.
Predictions for the Next Decade
The advantage of looking ahead ten years is that you can look beyond the short term uncertainties. And, boy, do we face some uncertainty! I’ve got this far without mentioning Brexit, but we probably can’t go much further without recognising it is going to influence the world around us for the next decade.
It’s taken three and a half years to find the exit door from the EU and sign a Withdrawal Agreement. It’s worth remembering that was supposed to be the easy bit of Brexit. The tough bit is what needs to happen now; agreeing a future trade deal with our EU partners. This will be one of the most complex trade deals negotiated and we are left with 10 months to do it. I may be proved wrong but agreeing any kind of deal that would work for our farming, food and drink sector and deliver frictionless trade in that time is mission impossible. Either way, it’s going to dominate the short term.
However, Scotland Food & Drink’s strength will come from keeping an eye on the long term prize. In a world where more people want high quality food and drink, with a strong provenance story, what an opportunity lies ahead for Scotland. We will need to continue our transformation into an exporting nation, following hard on the heels of success seen in Scotch whisky and now salmon. At the same time, there remain huge opportunities right on our doorstep to ensure people and visitors in Scotland have access to the quality being produced on their doorstep. And we will need to focus on how we become the home of ‘climate-friendly’ food production. Our current production systems mean we start from a good place but we’re going to have to work hard to be a central part of a net-zero Scotland. We also have 40,000 jobs to fill in the coming years to attracting our future workforce is critical.
Most business I speak to in our industry see short term challenges and long-term opportunity. That’s exactly where I am too. Perhaps the most important discipline we need for the next decade is to ensure that the short term challenges like Brexit – much of which is out of our control – doesn’t distract from the unquestionable opportunity that our country now faces in becoming one of the world’s leading food and drink nations; a land of food and drink.