Threat to our energy industry

The north-east has had a challenging three years brought on by the impact of the global oil and gas downturn.

Pace is slowly but surely picking up once more and many businesses are hinting that the worst could be over.

But it is this very industry, which has proudly led to the region being dubbed Europe’s oil capital over the past five decades, which could now be hit once more by Brexit.

A new report was published recently by the think tank Centre for Cities which showed the profound effect of our exit from the European Union.

The findings were stark in revealing the north=east will be faced with very real economic challenges from either a hard or soft Brexit.

The analysis echoes warnings which have already come from industry body Oil and Gas UK.

In a report on Brexit only a couple of months ago its chief executive said there could be an additional £500 million every year because of changes to trade agreements.

Sectors including oil and gas, food and drink and the health and social care sector will all have considerably more difficulty in a post-Brexit economy.

And the damaging effect of a hard Brexit on our universities and colleges will further impact on the local economy.

We are currently in a state of limbo where we are unsure of what the future holds for many of our sectors.

The UK’s Brexit department has claimed they have bold and ambitious plans for a free trade deal.

Andrew Carter, the chief executive for the Centre for Cities, said Aberdeen will see the biggest reduction in economic output because of the oil industry’s dominance in the city.

The financial and business services which support the sector will also be hit hard by the tariffs.

As we have learnt in recent years, it is diversification which is needed to improve our economy in the coming years.

It will be this continuing challenge to widen our industrial structure in the years ahead which will help as we try to be less reliant on one sector.

This is going to be crucial in order for the north-east to continue to thrive once we leave the EU.

But the most important thing is that the UK Government does it all it can to minimise the economic shocks by securing the best possible trade deals we can do with the European Union.

North-east businesses must have assurances that any trade deals are also as similar to the current relationship we have with the European Union as possible.