NICOLA Sturgeon has suggested that post-war West Germany will provide the latest foreign economic blueprint for Scotland to emulate in a major speech at the World Bank.

 

The First Minister, on the third day of her tour of the United States, said that "Rhine capitalism" had succeeded in combining strong growth with social protections for workers.

Previously, the SNP has embraced a 'Celtic tiger' model adopted in Ireland, which would involve attracting businesses by slashing corporate tax rates. Former leader Alex Salmond has also advocated Scotland joining a northern European 'arc of prosperity' including Iceland. The rhetoric was dropped after both the Irish and Icelandic economies hit the buffers in the wake of the recession.

However, Ms Sturgeon said that the economy she was now aiming to create was in some ways similar to the 70-year-old West German model, which emerged following the devastation of the Second World War.

She said: "West Germany developed what became known as Rhine capitalism. It encouraged competitive markets, but combined them with strong social protections. It instilled a strong sense of partnership between workers, trade unions, businesses and public sector. As a result, the German economy has been characterised by innovation, high productivity and strong exports.

"What we're aiming to create in Scotland is in some ways similar. We're investing in the innovation and infrastructure which is essential to future productivity growth. But as part of that, we're also creating an inclusive society - one which harnesses the talents of all of our people, and which shares the benefits of growth more equally.

"We're pretty confident that we're on the right path, but we also know that we have a huge amount to learn."

In the speech, one of the most high-profile engagements of the First Minister's tour of the United States, she spoke of addressing an "apparent paradox" of deep social inequalities in a wealthy country.

She added: "We want to increase our competiveness to boost our GDP per head. And we also want to create a fairer society with a better distribution of income.

"And what we increasingly recognise is that those two challenges - of competitiveness and equality - aren't separate issues. They are connected. We would have an even more competitive economy, if we had a fairer society."

Ms Sturgeon also had time for a cuppa with Hollywood actor and SNP supporter Alan Cumming.

Nicola Sturgeon attended the US launch of a Perthshire-produced tea at the Lowell Hotel on New York's Upper East Side.

Staff will serve guests tea grown by The Wee Tea Plantation in Amulree as part of its traditional high tea.