Economy of Scotland

The economy of Scotland is an open mixed economy and the second largest economy of the four countries of the United Kingdom. It had an estimated nominal gross domestic product (GDP) of £211.7 billion in 2023, including oil and gas extraction in the country's continental shelf region. Since the Acts of Union 1707, Scotland's economy has been closely aligned with the economy of the rest of the United Kingdom (UK), and England has historically been its main trading partner. Scotland conducts the majority of its trade within the UK: in 2017, Scotland's exports totalled £81.4 billion, of which £48.9 billion (60%) was within the UK, £14.9 billion with the European Union (EU), and £17.6 billion with other parts of the world. Scotland’s imports meanwhile totalled £94.4 billion including intra-UK trade leaving Scotland with a trade deficit of £10.4 billion in 2017.

Scotland was one of the industrial powerhouses of Europe from the time of the Industrial Revolution onwards, being a world leader in manufacturing. This left a legacy in the diversity of goods and services which Scotland produces, from textiles, whisky and shortbread to buses, computer software, ships, avionics and microelectronics, as well as banking, insurance, investment management and other related financial services. In common with most other advanced industrialised economies, Scotland has seen a decline in the importance of both manufacturing industries and primary-based extractive industries. This has, however, been combined with a rise in the service sector of the economy, which has grown to be the largest sector in Scotland.

The governments which involve themselves in Scotland's economy are largely the central UK Government (responsible for reserved matters via HM Treasury) and the Scottish Government (responsible for devolved matters). Their respective financial functions are headed by the Chancellor of the Exchequer, and the Cabinet Secretary for Finance. Since 1979, management of the UK economy (including Scotland) has followed a broadly laissez-faire approach. The Bank of England is Scotland's central bank and its Monetary Policy Committee is responsible for setting interest rates. The currency of Scotland, as part of the United Kingdom, is the Pound sterling, which is also the world's fourth-largest reserve currency after the US dollar, the euro and Japanese yen.

As one of the countries of the United Kingdom, Scotland is a member of the Commonwealth of Nations, the G7, the G20, the International Monetary Fund, the Organisation for Economic Co-operation and Development, the World Bank, the World Trade Organization, Asian Infrastructure Investment Bank and the United Nations.