Independent Scotland faces "disaster", says Harvard's Kenneth Rogoff

 
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Kenneth Rogoff warns a Yes vote could be disastrous (Source: Getty)

As the latest polls give breathing space to the Better Together campaign, Harvard economist Kenneth Rogoff has thrown his two cents into the Scottish independence debate. His remarks will make grim reading for the Yes camp.

Speaking to CNBC, Rogoff said: "It's certainly a disaster for Scotland, first and foremost, it's going to be a horrible adjustment".

It was not all pleasant reading for the No side either, with the former chief economist and director of research at the International Monetary fund adding:

Even if it doesn't pass people are not going to want to invest there because they might do it again. People will migrate out of there.

According to Rogoff, there is no good economic outcome from the Scottish referendum. The man once dubbed "George Osborne's favourite economist" said the uncertainty being created would damage the rest of the UK, which has been enjoying stronger growth and higher employment than many of its competitors.

Forecasts have already been made as to what the negative consequences for the rest of the UK may be in the case of Scottish secession.

According to Axa investment Managers, GDP growth would be "markedly lower", falling by 0.25 per cent in 2014 and 0.75 per cent lower in 2015.

Furthermore, the impact of the Scottish referendum may extend well beyond UK shores, Rogoff warned. Regions and communities across Europe - Catalonia, for example - may begin seeking independence referendums of their own.

Rogoff's verdict will be a further blow to the Yes campaign after a host of major financial institutions confirmed they would relocate to England if Scotland went independent.

Earlier today the Royal Bank of Scotland (RBS) said it was making contingency plans to re-domicile in England in case of a Yes vote. Lloyds, Standard Life and the Clydesdale Bank are also planning to quit Scotland and move their headquarters to London if voters back independence in next week’s referendum.

Yesterday, the main Westminster party leaders abandoned PMQs to head north of the border in an attempt to persuade voters not to abandon the 300-year-old union.

Labour, Liberal Democrats and Tories have promised to transfer powers to Scotland in the event of a No vote. The Better Together campaign announced yesterday that a draft law will be ready to vote on by parliament by the end of January.

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