Full extent of universities’ economic contribution revealed as report shows universities play a role in close to half of all foreign direct investment into Scotland

A report, Grow Export Attract Support, published today [Monday, 2 September] by Universities Scotland sets out a new framework showing the full extent of universities’ economic contribution to Scotland.

New to this framework is recognition of the role that universities play in the attraction of foreign direct investment (FDI) into Scotland. Universities are amongst the key “pull” factors attracting investment into Scotland with an analysis of investors’ motives, completed by the Financial Times’ FDI Intelligence, finding universities linked to close to half of all inward investment projects.

Universities’ role in attracting inward investment is three-fold: as a producer of a highly-skilled graduate and postgraduate talent pool; as a globally recognised source of research, development and innovation; and lastly as an actor in the creation of industry clusters or ‘agglomerations’ sought after by investors.

Foreign direct investment creates jobs at all levels and contributes to sustainable economic growth. Scotland performs very strongly in the competition for FDI, punching well above its weight and leading the way on FDI projects in the UK outside of London. GlaxoSmithKline, Samsung Heavy Industries, Dakari, SAS, ResHydro, Molnlycke, Toshiba Medical, Fujitsu, Odyssey Financial Technologies and enStratus have all invested or expanded projects in locations across Scotland in the last couple of years, citing universities as a determining factor.

Commenting on the report, Grow Export Attract Support, Professor Andrew Goudie CB FRSE, former Director-General Economy & Chief Economic Adviser to the Scottish Government, said:


“Universities are recognised throughout the world as one of the critical drivers of sustainable economic growth. National comparative advantage in highly competitive global markets rests heavily on the capacity of universities to educate and produce knowledge and research that are truly acknowledged as being globally excellent. An outstanding higher education sector is therefore fundamental to our ambitions for a nation that is both wealthier and where economic success is at the heart of creating a cohesive society which enables individuals and communities to realise their full potential.”


Professor Steve Chapman, Principal of Heriot-Watt University, said:

“Universities have been recognised as an agent of economic growth for some time. They have a considerable impact as a sector in their own right, contributing £6.7 billion in gross value added to Scotland. What is most significant about this new framework for universities’ economic contribution is that it uncovers the role universities have in helping to drive economic growth outside their sector; making Scotland a competitive place for foreign direct investment. This creates jobs at all levels throughout Scotland and helps support Scotland’s sustainable economic growth.”


Anne MacColl, CEO of Scottish Development International said:


“Universities are an integral component of Scotland’s ambitious international Trade and Investment strategy. Their contribution has genuine international reach: it has positive impacts upon Scottish exports, attracting new inward investment and on providing research excellence and a highly qualified graduate output to existing investors and domestic companies. All these areas are invaluable to growing Scotland’s companies and sectors. SDI is delighted to support the launch of this new framework and to work with the sector to ‘grow, export, attract and support.”


Universities’ role in attracting foreign direct investment adds to their three other economic functions, as covered by the report:



  • Universities have already been recognised by the Scottish Government as an economic sector in their own right, contributing £6.7 billion to the Scottish economy in 2011/12.
  • A sector that remains resilient in tough economic times as its economic impact grew by an estimated 6.7 per cent over the last year.


  • Universities have a significant export role worth £1.3 billion to the Scottish economy.
  • Sixty per cent of the sector’s exports coming from outside of the United Kingdom; placing universities top of the second quartile of all Scottish industries for international export performance.


  • Universities also play an important support role for other aspects of Scotland’s economy including small and medium sized enterprises through the translation of their research and expertise.
  • Universities work with over 26,000 companies every year to translate the outputs of their research and development into new products and processes for business.
  • Scotland comes first for its level of university-industry collaboration when compared to nine other advanced nations including the United States, Germany and Japan according to data from the World Economic Forum Global Competitiveness report.