2014.07.2206:07:13UTC+00Possible Scotland independence puts finance sector at risk

Possible Scotland independence puts finance sector at risk

A report released on Monday by a Scotland group likened to a “dead parrot” the notion raised by nationalists of making a currency union as an independent country with the United Kingdom.

According to the Scottish affairs select committee, entering a currency union would only lead to sabotaging the credibility of their own political and economic prowess. The report cited the economic problems indepence would raise such as the relocation of several financial service companies away from the country which some businesses have already made tentative plans for. If the companies stay, it could also potentially threaten the country’s financial stability owing to an “exceptionally large” industry.

The Scottish National Party has said before that it would prefer to keep the Bank of England’s pound if independence is voted for later in September. For this to happen, chancellor George Osborne says that Scottish banks would have to stop printing banknotes in sterling and hold on to all pounds that enter the country should they gain independence.

An alternative for the country is what has been called as sterlingisation, where it will continue to use pounds without the Bank of England’s permission putting up instead their own central bank. Adopting the euro is also an option if membership into the European Union is granted in short amount of time.

The report adds that the greatest economic freedom can only be gained if Scotland creates its own currency instead of sharing the pound or the euro.