Scotland’s Natural Economy
Putting rural areas at the forefront of a green recovery.
Scotland is widely regarded as having a significant stock of high quality natural capital, but the potential of the country's natural economy is not always fully understood or acknowledged. The short briefing (available below) outlines some key ways in which this potential can be enhanced so as to place Scotland's rural businesses and communities at the forefront of a green recovery from the Covid-19 pandemic.
Key points
Scotland has a significant stock of natural capital, which is defined by NatureScot as "the habitats and ecosystems that provide social, environmental and economic benefits to humans."
Six economic sectors are widely regarded as making up the natural economy: tourism, food and drink, fishing and aquaculture, energy (including renewables) and forestry, logging and manufacture of wood. In 2018, the natural economy contributed £29.1 billion Gross Value Added to the Scottish economy and employed 290,000 people.
The natural economy can be considered as consisting of three elements:
- resources that can be extracted for example through mining, energy, agriculture, fishing, food and drink and forestry activities
- landscapes that can store or bank environmental resources or ecosystem services such as carbon storage
- activities which can be set up and maintained in order to benefit from natural resources (when they are in 'good condition'), including tourism and recreation businesses, in order to increase their value
Various actions can be taken to ensure that the natural economy is a driver of inclusive, sustainable, and just growth in Scotland in future, including:
- improve knowledge, training and skill levels and encouraging entrepreneurial activity, combined with appropriate business support provision, in new natural economy-related opportunities across rural Scotland
- expanding research and education capacity on the natural economy, with stronger partnership working between all stakeholders (including research and education providers, enterprise agencies, Business Gateway, local authorities, and Skills Development Scotland)
- taking a more positive approach to understanding and strengthening rural economies and communities, leading to a positive narrative, rather than a negative one based on a deficit approach
- taking an integrated, holistic and place-based approach to all interventions, including land management, which includes tailored investment in local assets, collaborative working with communities and a recognition of the need to achieve multiple objectives
- supporting those communities endowed with significant natural economy assets, but which may be facing a range of persistent challenges (e.g. depopulation, out-migration of young people, limited housing, declining service provision) to build a more sustainable, inclusive and just future based on those assets
- re-setting the tourism industry away from high volume to a more balanced approach with a consideration of the net benefits that can be achieved
- working to encourage everyone across rural and urban Scotland to grasp the opportunities of the natural economy to deliver a green recovery. Rural areas can be at the forefront of this new economy focused on wellbeing, inclusivity and equality, and based on high quality natural capital assets.
Read more in our Policy Spotlight below.
Authors: Jane Atterton (SRUC) and Davy McCracken (SRUC).
