Fitch: Scottish independence to hit British economy hard

 

Scotland’s potential independence would have a negative effect on the economy of the United States and could result in downgrade of the country’s credit rating, Fitch Ratings said in a press release on Tuesday.

 

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On Monday, Scottish First Minister Nicola Sturgeon said that she would seek the authority to hold another independence referendum, which should take place between fall 2018 and spring 2019 to accommodate for Brexit negotiations.

 

“A second Scottish independence referendum that resulted in vote for independence would be a negative credit shock for the UK economy and public finances, and could lead to a rating downgrade… We believe Scottish independence would have adverse effects on the UK public finances and economy and so would be credit negative for the UK,” the statement said.

 

The statement added that the main uncertainties that could affect the impact of potential trade ties between the United Kingdom and independent Scotland, as well as the currency arrangements made by Edinburgh.

 

At the moment, the rating agency considers that the United Kingdom has “AA” sovereign rating with a negative outlook and the next review of the UK ratings is expected to take place on May 5. According to the agency, the negative outlook reflects the uncertainty that emerged following the Brexit referendum.