Beyond the Fringe: The signs of confidence in Scotland’s economy are growing

The Festivals are part of what makes Edinburgh, Edinburgh. They showcase the creativity, ambition and international outlook that have long been among the capital’s greatest strengths and continue to attract visitors, investment and talent from around the world.

But beyond the performances, packed venues and busy streets, there’s a wider economic story worth reflecting on. The qualities that make Scotland a successful host for globally significant cultural events are the same qualities that help businesses grow: confidence, innovation, talent and a willingness to look ahead.

It’s therefore fitting that today, as Edinburgh’s Festivals enter their final week, Barclays is publishing its latest Business Prosperity Index. At a point in the year when the city naturally begins to reflect on the impact of another August, the findings offer grounds for optimism about Scotland’s wider economy too.

According to the latest Barclays Business Prosperity Index, Scottish businesses expect investment to rise by 12 per cent over the next year. That’s the highest expected increase of any UK nation or region and 7.9 percentage points above the UK average. The same research found that some 92 per cent of Scottish firms say they’re confident in their business prospects.

Those figures matter because confidence is not simply a mood. At its best, it becomes action: businesses investing in people, technology, equipment, premises, exports and innovation. It becomes decisions that support jobs, strengthen supply chains and build resilience in local economies.

Anyone watching Edinburgh in August sees that principle in practice. The success of the Festivals depends on thousands of individual decisions made long before the first audience arrives: venues committing to programmes, performers backing their ideas, hospitality businesses planning for demand, and suppliers preparing for one of the busiest periods in the city’s year.

Business investment works in much the same way. Growth doesn’t usually come from waiting for perfect conditions. It requires decisions made ahead of opportunity, not after it has arrived.

That’s what makes the latest Barclays data encouraging. The economic backdrop remains challenging, and the Business Prosperity Index is clear that Scottish firms continue to face pressure on cash generation and tougher trading conditions. But despite those pressures, many businesses still appear willing to look beyond the immediate environment and plan for growth.

There are also signs that larger Scottish firms are backing those ambitions with finance. Barclays data shows that among large corporates in Scotland, average loan value increased by 10.3 per cent and loan volumes rose by 18.3 per cent, suggesting more firms are looking for finance to support investment and growth.

That is why access to finance matters. Through the Barclays Business Prosperity Fund, Barclays has made £22 billion available in 2026 to support lending to new and existing Business Banking customers and UK Corporate Banking clients across the UK. For firms looking to invest, expand, improve productivity or refinance existing projects, it’s a practical way to help turn confidence into action.

And so the lesson from the Festivals is broader than culture or tourism. Edinburgh’s success in August is built on an ecosystem. It depends not only on performers and audiences, but on venues, small businesses, transport, hospitality, creative talent, professional services and the city’s international reputation. No single part of that ecosystem can deliver the whole result on its own.

The same is true of Scotland’s economy. Sustainable growth depends on businesses of different sizes, sectors and regions having the confidence and support to invest. Finance, skills, infrastructure, innovation and policy certainty all matter, but they matter most when they work together.

For policymakers, business leaders and institutions, that means focusing on the practical conditions that allow firms to move from intention to delivery. Businesses need certainty where possible, access to the right finance, a skilled workforce, strong infrastructure and an environment that rewards enterprise and innovation.

As the final days of the Festivals approach, Edinburgh will soon begin to return to its usual pace. The crowds will thin, familiar routes will become easier again, and the city will take stock of another remarkable August.

But the broader message should stay with us. Scotland’s strengths are not confined to one month, one city or one event. Creativity, ambition, talent and international reach are part of our wider economic story.

Today’s Barclays Business Prosperity Index suggests those qualities are evident across Scotland’s business community too. Firms recognise the challenges ahead, but many are still investing, adapting and planning for growth.

That should give us reason for optimism. The confidence is there. The willingness to invest is there too. The opportunity now is to help Scottish businesses turn that confidence into lasting prosperity for communities across the country.

Jamie Grant, managing director, Barclays Corporate Bank, Scotland