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Small states should seek role models in the Nordics of 2013, not the Estonia of 1991

May 31, 2013

There was an interesting piece in the Scottish paper The Herald a day or so ago commenting on a report which purports to link increased investment in post-Communist European countries with the sort of investment windfall that could come to Scotland should it get independence.

The Herald’s piece quotes the report saying: “There is some evidence that the most recently independent small countries of Europe experienced a surge in overseas investment in the immediate aftermath of independence. Experts and business people believe this could be mirrored in Scotland – particularly given many of those countries in the 1990s did not have as developed a market economy as Scotland does.”

This sweeping comment rather lends the report an unrealistic analysis and subsequent comments on the website below the newspaper article pick this up and highlight an inherent difference between Scotland and those East European countries in the 1990s. The Baltic States, in particular, were effectively starting from ground zero as far as investment was concerned when they became independent in 1991. The public utilities especially were woefully underfunded and all those countries, albeit with different strategies and timescales, entered a period of wide scale privatisation. Foreign investment was pulled in as these countries made the transition from a socialist to a free market economic system. Scotland can hardly be in the same position as Estonia in 1991; to suggest so does the pro-independence campaign no favours. It would be better, surely, for Scotland to seek role models in Scandinavia and Finland. The Economist ran a special report back in February which asserted that ‘the four main Nordics – Norway, Denmark, Sweden and Finland – are doing rather well’. All these countries incidentally have roughly the same sized population as Scotland (and indeed Yorkshire). The report then goes on to show why they might be ‘doing rather well’ and one of the words that is used several times is ‘pragmatism’. Indeed two lines in the concluding paragraph are worth repeating. Firstly, ‘the main lesson to learn from the Nordics is not ideological but practical’…And ‘you must be ready to abandon tired orthodoxies of the left and right and forage for good ideas across the political spectrum.’ It is ever thus that political parties in Nordic countries seem much more willing to collaborate and cooperate with each other, not least because there are so many of them! But it can mean that parties, as seemingly ideologically different as former Communists and Christian Democrats, can sit together in Government (as is the case in Finland currently) on behalf of the common good. So this must be an opportunity for Scotland as it possibly prepares to enter a whole new era: ditch the ideology and seek the practical. Even if Scotland does not pick up this mantra Yorkshire should. It is ideology which has held Yorkshire back for generations. At the same time Yorkshire folk are nothing if not practical. The apparently successful Nordic model is one that should have a resonance across the county. And it fits.

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