Scotland business

Scottish economy continues to grow

Construction site Image copyright Getty Images

The Scottish economy grew by 0.3% in the final three months of 2018, according to official figures.

The increase in the country's gross domestic product (GDP) compared to a figure of 0.2% for the UK as a whole.

The news comes after Scotland's unemployment rate hit a record low.

Scottish Finance Secretary Derek Mackay said it was the eighth consecutive quarter of growth and that the country's economy "continues to go from strength to strength".

The UK government's Scottish Secretary David Mundell said the 'City Deals' investment programme was aiding the growth in GDP.

'Strength to strength'

The full year figures for 2018 now suggest that Scotland's GDP grew by 1.4% compared to 2017, the same as the UK.

Growth across the year has been driven by the services and construction sectors, which both grew by 1.7% in 2018.

Services - which makes up the bulk of Scotland's economy - grew by 0.5% in the last three months of the year, while construction grew by 0.8% in the same period.

Image copyright Getty Images

However, the production sector shrank by 0.9% between October and December, with agriculture, forestry and fishing down by 1.1%.

Independent economists have warned that a disorderly Brexit could have a severe impact on Scotland's GDP rates.

Mr Mackay said: "With eight consecutive quarters of growth and record low unemployment - down to 3.4% - Scotland's economy continues to go from strength to strength.

"Growing our economy and supporting businesses and jobs is a top priority for the Scottish government.

"However, the UK's EU exit remains the biggest threat to our economic stability."

'Big impact'

Mr Mundell said: "I am encouraged by these GDP figures, which show Scotland's economy continuing to grow.

"The news follows positive employment statistics and it shows UK government support included in the Budget and the Spring Statement - and our £1.35bn investment in city and growth deals - is having a big impact.

"However, I'm concerned the Scottish economy has not shown the same growth as the UK as a whole over the past few years and it is important to close the gap."

Tracy Black, director of the business lobby group CBI Scotland, said: "While the latest stats show eight consecutive quarters of growth, overall economic momentum remains worryingly weak.

"What we desperately need is a step-change if the Scottish economy is going to deliver on higher wages, improved living standards and increasing the potential for stronger, sustained growth in the future - an economy that's barely in first gear isn't going to cut the mustard.

"Brexit uncertainty continues to be a significant factor behind weaker growth."

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