The report, delivered in partnership with Prosper and commissioned by the Scottish Government, finds that Scottish services exports were worth about £16 billion in 2023, around twice their nominal value in 2008.

However, the research finds that non-tariff barriers remain a significant constraint on further growth.

These include the recognition of professional qualifications, licensing and certification requirements, restrictions on short-term business mobility, local establishment requirements, differences in standards, and data-related regulation.

Businesses also face less visible “soft” barriers, including client preferences for locally-based providers, familiarity with domestic standards and the importance of established in-market relationships.

The report finds that these commercial expectations can sometimes be as restrictive as formal regulation.

Services businesses account for nearly 41% of Scotland’s international exports, supporting high-value employment across sectors including financial services, professional and business services, digital technologies, science and research, and energy-related services.

Professional, scientific and technical services represented the largest selected category of services exports in 2023, at £4.6bn, followed by financial and insurance services at £2.6bn and wholesale, retail and vehicle repair at £2.2bn.

Professor Mairi Spowage, director of the Fraser of Allander Institute, said: “Scotland has an internationally competitive base of knowledge, expertise and specialist services.

“This report shows that the opportunity is substantial, but success depends on more than demand alone. Reducing regulatory friction, improving mutual recognition and helping firms build trusted relationships in key markets will be essential if Scotland is to convert its strengths into sustained export growth.”

Established markets – including the rest of the UK, the European Union and the United States – remain central to Scottish services exporters.

At the same time, growing demand in India, China, the Gulf states and other emerging markets presents new opportunities for financial services, engineering, digital technologies and research.