Scottish Smart Specialisation Strategy Journey

Rob Clarke, Highlands and Islands Enterprise

Alison Munro, Scottish Enterprise

Presentation objectives

• Scotland’s Smart Specialisation approach

• Overview of Scotland

• Scotland’s economic priorities

• Insights - Renewable Energy and Food & Drink

• Next Steps on Scotland’s RIS3 journey

• Opportunities & Challenges of RIS3

Scotland’s Smart Specialisation Approach

• Supportive of “Specialisation” concept

• Part of a DG Regio S3 “pilot assessment; not (yet) on the S3 Platform

• Driven by a Scottish-wide approach

• Value in the process - opportunity to learn from others, to share ideas and to refresh our approach

Overview of Scotland

Population: 5.2m (8.5% of UK)

Area: 30,420 sq miles (33% of UK)

Geography mix of urban & rural

Working Population 2.5m

GVA (economy) £105 billion (8% of UK)

Scottish Parliament Established in 1999

Devolved powers: Education, health, justice, (Scottish controlled) economic development,

transport Reserved powers: Defence, tax, (UK controlled) social security,

macro-economic, foreign policy, etc

Purpose

To focus the Government and public services on creating a more successful country, with

opportunities for all of Scotland to flourish, through increasing sustainable economic growth.

http://www.hie.co.uk/

Increased Sustainable

Economic Growth

Drivers of Growth Productivity Participation

Population Characteristics of Growth

Solidarity Cohesion Sustainability

Increasing Incomes & Opportunities for everyone

in Scotland

Increasing Revenues & more Effective Government

Inter-linkages of the Government Economic

Strategy

STRATEGIC PRIORITIES

that shape progress towards sustainable growth

Growth Sectors

Creative Industries

(Digital Markets)Energy

Life Sciences

Financial & Business

Services

Food & DrinkSustainable Tourism

Enabling Technologies

Enabling Technologies

Universities

Renewable Energy

• “Once in a generation” opportunity

• Harnessing natural advantage; building on existing capability

• Driven by government policy –100% of electricity demand to be renewable generation by 2020

• The challenge: to capture economic and social benefits

Renewable Energy

Strategy led by Energy Advisory Board – govt, industry, academia

•Collaborative approach to:

Infrastructure: ports & harbours, R&D, device testing Funding: public (UK, Scottish and EU) and private

Renewable Energy

• Collaborative approach to: Research: R&D,

device testing and deployment

Skills: from apprentice to Ph.D

Renewable Energy

• International Connections are key success factors:

Inward Investors Global Supply Chain International Markets

Scotland Food & Drink - The key numbers

• Primary sector – 69,000 jobs farming, fishing and

aquaculture £2.9bn turnover £836m GVA

• Manufacturing – 44,000 jobs 1200 companies £9bn turnover £5.4bn exports £4bn GVA

• Retail & Services – 246,000 jobs wholesale, retail and

foodservice

Scotland's Strengths

Drinks –10,800 jobs £4.4bn turnover £2.7bn GVA

Bakery - 11,300 jobs £1bn turnover £417m GVA

Fish & Seafood - 8,300 jobs £1.3bn turnover £278m GVA

Meat processing - 5,900 jobs £968m turnover £178m GVA

Dairy - 2,700 jobs £524 turnover £134m GVA

Fruit & Veg - 2,000 jobs £476m turnover

Scotland’s strengths

Strong research institutes

Product and process innovation

Positive global brand, identity & consumer image

The Scottish Food & Drink Strategy

Strategy Model

Grow the Industry to £12.5 bn by 2017

Premium Health Provenance

Reputation as a “Land of Food & Drink”

Innovation Skills for Growth Collaboration Scale

Sustainability

Core to the strategy is

economic and environmental sustainability

Naturally Healthy

Better for You

Health Enhancing

£0.7Bn

Authentic description

Scottish where appropriate

Romance the image

£0.6Bn

Adding more value

Premium brands

Moving up the value stream

£1.2Bn

Building on the capabilities we have or need

to develop

Cememting a global

reputation,

With products available to

match demand

An inclusive target for our

industry

£12.5bn includes fishing and agriculture

Processing target remains

£10bn

Food &Health

Innovation

INSIGHTSMarket

Intelligence

Food& Drink Forums

Skills Academy

Sustainability/Low Carbon

UK & International

MarketDevelopment

Company Growth

Delivering the Food and Drink Strategy

Meet the Buyer & Buyer Briefings

Key Performance IndicatorsMeasure Target Progress and Comment

Turnover£10bn to £12.5bn

£11.9bn – Great progress – increased sales in UK and international markets

GVA

£4.1bn to £6.1bn

£4.8bn – Good progress,

Continue outperforming GVA of UK &

Scottish benchmarks

On track – although challenging with variations from quarter to quarter

R&D Spend0.25% to 0.75% of sector GVA

0.25% - No progress to date, and significant growth still required. Innovation and R&D are focus of a number of big new projects in the sector

which are just launched and may have a positive impact over time

Productivity

Equal UK level for food

processing

Continue outperforming

UK level for food & drink

processing

Particular performance issue with food processing sector

The outstanding productivity performance of the scotch whisky industrymeans the overall performance of the Scottish food & drink

Exports£3.7bn to

£5.1bn£5.4bn – Great progress – food exports £1.16bnnew stretch targets to 2017 in development

Next Steps on the Journey

• Working with our “Assessor” to refresh our S3 approach

Tell a better story on the why and how

Understand the focus of our specialisation

Drawing more on the evidence base

Priorities for future EU Funds

• Using the process to learn and explore new ideas

Smart Specialisation Opportunities / Challenges

• Opportunities Learning and peer review Potential for collaboration

Enhanced private sector role – leading and funding

More Strategic use of EU funding

• Challenges Demonstrating RIS3 impact on economic growth Matching academic and industry focus More Strategic use of EU funding

Role for the Commission

Lead the process of evaluation to demonstrate the value of RIS3 as a driver of economic growth

Maximise the learning potential of RIS3 Identify potential synergies between Regional Policy

and Horizon 2020 Don’t adopt a rigid approach to ex-ante conditionality Make clearer the synergies / alignment between SFs

and H2020

Questions?