Sturgeon primes Scotland for all options after Brexit vote

By Elisabeth O'Leary

GLASGOW, Scotland (Reuters) - Scotland's devolved government is preparing for all possibilities including independence after Britain leaves the EU, and is planning steps to protect its trade ties with Europe, First Minister Nicola Sturgeon said on Saturday.

The Scottish National Party leader has raised the nation's profile since June's European Union referendum in Britain, seizing on a new openness towards Scotland in the European Union since Scots voted by a large margin to remain in the bloc.

Britain's overall vote to leave has reignited talk of a split between Scotland and the rest of the United Kingdom, even though Scots rejected independence just two years ago.

"If (the British government) insists on taking Scotland down a path that hurts our economy, costs jobs, lowers our living standards and damages our reputation as an open, welcoming, diverse country - then be in no doubt," she told the SNP conference at its close, "Scotland must have the ability to choose a better future."

Sturgeon said economic stability has been threatened by the prospect of the UK leaving the European single market as well as the EU, taking Scotland with it.

Scotland wants to keep as many of the advantages of single market membership as it can even if Britain leaves, and is looking for a bespoke deal to do so, as is London, where a majority also voted to remain in the EU.

Sturgeon says that protecting Scotland's interests may mean holding another vote on independence. At present, polls do not indicate that such a vote would be won, however.

The British government has stuck to saying there will be a one-size-fits-all deal for the UK after it leaves the EU.

But Northern Ireland, which also voted to remain, has had a sympathetic hearing for its concerns about the creation of a "hard border" with the Irish Republic. Scottish government sources say that this may be creating an anomaly, and that Scotland's options over its border with England should also get an open hearing.

Scotland's minister for EU negotiations told Reuters on Friday that while there need be no hard border with England, Edinburgh may try to take control of migration as part of an enhanced devolution deal once Britain leaves the EU.

BUSINESS WANTS CLARITY

British ministers have suggested that the UK could leave the EU's single market for goods and services to allow it to reimpose stronger control over its borders. The comments have driven the pound to its lowest level in three decades.

To protect business in Scotland, Sturgeon said the devolved government will set up a board of trade, a new trade envoy scheme, expand its Scottish enterprise agency and establish a Scottish trade hub in Berlin, adding to current representation in Dublin, London and Brussels.

She also announced the extension of a scheme to shore up small businesses by scrapping taxes on their premises, and a half billion-pound loan scheme for companies that want to expand.

Scotland wants to keep its single market membership advantages even as Britain leaves the EU and the British government has room to make a deal, Derek McKay, Scottish minister for finance and the constitution, told Reuters.

"What we're saying to the UK government is 'Be creative, have an open mind'," he said.

Many companies including TSB, JP Morgan, Coca Cola, Mastercard and Fujitsu who were absent last year attended the conference's business session, an SNP source said.

"After the mess that has followed the (Brexit) vote, business is desperate for clarity and leadership," Kate Forbes, a Scottish lawmaker at the conference, told Reuters.

Sturgeon said on Thursday that the Scottish government would publish a blueprint next week for a possible new independence vote. She has not said if or when the bill would be presented formally to the Edinburgh parliament.

(Reporting by Elisabeth O'Leary; Editing by Andrew Bolton and Hugh Lawson)

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