Holmes Mackillop says that the second Trump presidency will have a profound impact on the Scottish economy.

Finlay Swan (pictured above), associate solicitor at Holmes Mackillop, suggests that while the intention to implement a 20% tariff on exports and an unrestricted, to quote Mr Trump ‘drill baby, drill’ approach to oil and gas was not unexpected news to the Scottish government, it must have nevertheless caught their attention. 

He said: “In 2023, the export of Scottish whisky was worth £5.6bn, most of that coming from America. There is therefore a clear economic incentive for the Scottish government to woo Mr Trump for an exception to his proposed 20% tariff on all goods coming into America.

After all, the US is Scotland’s largest export destination. The First Minister might think pressure can be successfully applied in appealing to Trump’s Scottish mother’s roots or his golf courses strewn across Scotland.” 

Swan says that trade tariffs have a chequered success rate, and while Mr Trump’s argument is that he is enriching Americans at the expense of foreign competition, the reality will likely be that the American consumer picks up the tab for the extra 20% on their bottle of Scotch and could well find such a price hike unsustainable, leading to reduced sales of Scotland’s iconic drink.

He commented: “It is however worth remembering that American tariffs on the water of life are not new, their last being a 25% tariff in effect between October 2019 and June 2021,” he says.

That stung the whisky industry badly and there will be a strong desire to avoid the same loss of revenue again.” 

Noting that Scotland’s expertise in the oil and gas industry is well-known in America, with the export of that expertise a key part of many of Holmes Mackillop clients’ business model. By making it easier to drill for oil and gas on American territory, Scottish supply chain businesses will no doubt be seeing an increase in work stateside.

He said: “Having myself previously worked in the industry, I know only too well the drastic, immediate effect political decisions can have on businesses in the sector, but this news will undoubtedly be a welcome reprieve for many Scottish businesses, particularly in the North East of Scotland, after years of declining business as the effects of fossil-fuel exploration on the planet becomes harder to ignore.

Scottish businesses will also recognise however that increased American drilling will drive down energy prices and therefore lower the political desire for further drilling in the North Sea at a time when such desire is already at an all-time low.”