Scots start slow march to independence

The Scottish National Party has launched its campaign to turn the idea of Scottish independence from a political fantasy into reality with an independence referendum in 2014. The British government is set to do the same within the next two weeks.

Amazingly, both camps on either side of the debate are headed by Scots. Bearing the “Yes Scotland” flag is the Scottish National Party’s Alex Salmond, the Scottish First Minister. The party has declared a march for secession from the union under the slogan “Scotland's Future in Scotland's Hands”. The SNP’s plan looks fairly straightforward, if a bit premature. In 2012 there will be a consultation on the details of the question to be put to Scots about their future. In 2013, legislation by the Scottish parliament will be put through to hold a referendum on independence. Then in 2014 a campaign and referendum, with subsequent negotiations on the transition to independence following a yes vote in 2015. Finally, come 2016, it is planned to hold the first general election in an independent Scotland.

Former Labor chancellor Alistair Darling, himself a Scot, coordinates the pro-union movement in the UK. This anti-independence coalition is formed by the three main pro-UK parties of Labor, the Tories and the Liberal Democrats. Darling already held a private meeting of senior figures in all three parties at his home in Edinburgh earlier this month. Salmond called the event a war council with “tea and sandwiches”.

British Prime Minister David Cameron is understandably very much against a Scottish divorce and is of Scottish descent as well.

It is going to be a very long march and the result might well be a “no” to independence. A recent YouGov poll found that only 33% of Scots would opt for independence, while 57% would reject it, findings which are close to several recent surveys but show lower support for independence than others. The poll findings were released by the former chancellor a few hours before Salmond launched his party's long-awaited "Yes Scotland” campaign to educate the undecided compatriots as to why they should feel better outside the UK.

Alex Salmond says that if and when the Scots decide to go their own way they would definitely join NATO. Scotland already has its own banknotes and flag.

The North Sea oil fields would provide enough revenue to turn the new nation into a Qatar or Kuwait of the North. North Sea oil is the jewel in the crown of an independent Scotland. Countries with “black gold” can go it alone in a way others cannot. It explains Greenland’s similar position with its push for drilling in its Arctic waters. It knows a big discovery could provide a pathway to quick economic – and then political - independence from its colonial masters in Denmark.

Who gets the oil in the event of Scottish independence depends on whom you speak to. Any division of the spoils will be hotly fought over by politicians in Edinburgh and London. If you draw a median line out across the North Sea from the border, then 90% of the oil tax revenues will accrue to Scotland. These are the calculations of the London National Institute of Economic and Social Research. Estimates show that the fields will run dry in the next 50-80 years, although some scientists insist there are at least 100 years worth of oil.

A logical consequence of Scottish independence, its opponents say, could be a display of flagrant oil exhibitionism at the expense of the estranged southern cousins. It could end up taking the form of Alex Salmond's government looking like Qatar royalty in a tartan kilt.

The SNP looks to Norway as an economic model because the Scandinavian nation has a small population of five million – comparable to Scotland’s – and yet is now sitting on a national pension fund worth over £300 billion.

Britain meanwhile has spent its hydrocarbon inheritance as it extracted it, something Salmond has promised he would no longer do. He opts to argue that an independent Scotland could raise £54 billion from tax revenues in the next five years, underwriting the country's ability to pay off debts and rebuild the local economy.

Most of the big oil fields lie offshore north of the Berwick-on-Tweed border, while an enormous new area of hydrocarbon production is being developed west of the Shetland Islands. The southern North Sea – off East Anglia – is still a significant area for gas production, but nothing like what lies to the north.

Westminster currently decides Scotland’s tax, but the civil servants that work on North Sea regulatory affairs are based in Aberdeen. An independent Scotland therefore would have most of the brain power in place, while all the big oil companies would use Aberdeen as an industrial center for their offshore operations.

Tourism has always been a big part of the Scottish economy. With its popularity among the royals, it has always been a bit of a playground for the rich and famous. It is a country made up of 790 islands, so some people suggest it could rebrand itself as northern Europe's very own Caribbean with lochs and glens.

Scotland's journey to self-governance will involve the country rethinking and repositioning itself internationally. Paradoxically, Alex Salmond says that the Queen would still remain Scotland’s head of state.

The Scottish government's 2009 document on independence makes clear that an independent Scotland would expect to remain a full member of the EU and increase its representation, but makes no mention of the euro. It confirms that the details of entry would be subject to negotiation.

If anything, the case for independence has weakened recently with the financial crisis exposing the vulnerability of small state economies. Ireland and Iceland were once models for a free Scotland – until they fell into abrupt economic ruin.