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Scottish independence: Currency union block could hurt firms, says Alex Salmond Scottish independence: Currency union block could hurt firms, says Alex Salmond
(35 minutes later)
Any move to block an independent Scotland sharing the pound could damage business in the rest of the UK, First Minister Alex Salmond has said. Blocking an independent Scotland's ability to share the pound could damage business in the rest of the UK, First Minister Alex Salmond has said.
Mr Salmond said the UK Treasury could impose "hundreds of millions of pounds" in costs on firms if plans for a post-Yes currency union were rejected.Mr Salmond said the UK Treasury could impose "hundreds of millions of pounds" in costs on firms if plans for a post-Yes currency union were rejected.
Last week Chancellor George Osborne said a vote for independence meant walking away from the pound.Last week Chancellor George Osborne said a vote for independence meant walking away from the pound.
The UK government rejected claims it was trying to "bully" Scots voters. The UK government said SNP ministers needed a currency alternative.
The row came ahead of the September 18 independence referendum, in which voters in Scotland will be asked the Yes/No question: "Should Scotland be an independent country?"The row came ahead of the September 18 independence referendum, in which voters in Scotland will be asked the Yes/No question: "Should Scotland be an independent country?"
Hitting out at Mr Osborne during a speech in Aberdeen, Mr Salmond said: "I am publishing today an estimate of the transactions cost he would potentially impose on businesses in the rest of the UK. Mr Salmond hit back at Mr Osborne during a speech in Aberdeen, as he published Scottish government analysis which said that a separate Scottish currency under independence could mean £500m in transaction costs for the rest of the UK.
"They run to many hundreds of millions of pounds. He said the bill would be incurred by industry and customers wanting to import and export from an independent Scotland.
"My submission is that this charge - let us call it the George Tax - would be impossible to sell to English business." The first minister said Mr Osborne had downplayed the disadvantages to the rest of the UK from a sterling zone.
Mr Salmond went on: "He said you don't need to be in a currency union to trade with other countries. No you don't. But it can impose a cost - a big cost.
"I am publishing today an estimate of the transactions cost he would potentially impose on businesses in the rest of the UK.
"They run to many hundreds of millions of pounds."
Mr Salmond added: "My submission is that this charge - let us call it the George tax - would be impossible to sell to English business.
"In fact if you remove oil and gas from the equation, Scotland is one of the very few countries in the world with which England has a balance of trade surplus."
Mr Osborne's position that he could not support the Scottish government's currency union plan was backed by the other two main Westminster parties, Labour and the Liberal Democrats.Mr Osborne's position that he could not support the Scottish government's currency union plan was backed by the other two main Westminster parties, Labour and the Liberal Democrats.
'Scottish response'
Mr Salmond said, "attempts to dictate from on high" the terms of the debate were damaging the democratic process.Mr Salmond said, "attempts to dictate from on high" the terms of the debate were damaging the democratic process.
He said Mr Osborne's position was not an economic assessment, but a "campaign tactic", adding that the "accumulated negativity" of the campaign to keep the Union, would "differ greatly from the reality of life" after the referendum.He said Mr Osborne's position was not an economic assessment, but a "campaign tactic", adding that the "accumulated negativity" of the campaign to keep the Union, would "differ greatly from the reality of life" after the referendum.
"To be told there are things we can't do will certainly elicit a Scottish response that is as resolute as it is uncomfortable to the 'No' campaign," said the Scottish first minister."To be told there are things we can't do will certainly elicit a Scottish response that is as resolute as it is uncomfortable to the 'No' campaign," said the Scottish first minister.
"It is, 'yes we can'. It is a sign of just how out of touch and arrogant the Westminster establishment has become.""It is, 'yes we can'. It is a sign of just how out of touch and arrogant the Westminster establishment has become."
Following Mr Osborne's comments, Mr Salmond wrote to Prime Minister David Cameron to accuse UK ministers of bullying behaviour. Chief Secretary to the Treasury Danny Alexander challenged Mr Salmond to set out a currency union alternative, telling the BBC: "We published further analysis from the Treasury last week which showed why a currency union would be bad for an independent Scotland, why it would be bad for the rest of the UK as well and why, therefore myself, and representatives of the Conservative and Labour have said we won't agree to it."
The Prime Minister's official spokesman responded: "Mr Salmond is very good at penning letters but not so good at answering questions." "I, as a Scot, would not recommend it to Scots under independence - what we're seeing is a pretty panicky response from Alex Salmond, full of false promises, full of failed sound bites, but no actual substantive answer to the question, if you can't have a currency union, what are you going to put forward instead?"
Mr Alexander said the only alternative suggestion to date would be for Scotland to use the pound without a currency union, similar to the way Panama uses the US dollar and Montenegro uses the euro, which he said were not appetising prospects for voters.
Mr Salmond's speech also came after European Commission President Jose Manuel Barroso cast doubt on Scotland's membership of the European Union in the event of a "Yes" vote.Mr Salmond's speech also came after European Commission President Jose Manuel Barroso cast doubt on Scotland's membership of the European Union in the event of a "Yes" vote.
Mr Barroso said it would be "extremely difficult, if not impossible" for an independent Scotland to join and that it would have to apply for membership and get the approval of all current member states.Mr Barroso said it would be "extremely difficult, if not impossible" for an independent Scotland to join and that it would have to apply for membership and get the approval of all current member states.
But the first minister said the EU had admitted so many countries that a "pragmatic way" would be found in the case of Scotland.But the first minister said the EU had admitted so many countries that a "pragmatic way" would be found in the case of Scotland.
Mr Salmond said no member state had suggested it would seek to block an independent Scotland from becoming an EU member.Mr Salmond said no member state had suggested it would seek to block an independent Scotland from becoming an EU member.