Oil price fall dents Scotland’s economic growth

North Sea oil platform

North Sea oil platform

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THE Scottish economy slowed in the final quarter of 2015 with confidence in international markets and a drop in the oil industry constraining growth, according to economic researchers.

The latest Scottish Business Monitor from the University of Strathclyde’s Fraser of Allander Institute (FAI) found new business levels eased during the three months to the end of November 2015 with an overall net balance of +3 percent compared to +17 percent in the previous quarter.

Export activity fell, while expectations for turnover in the next six months have also fallen.

Export activity fell, while expectations for turnover in the next six months have also fallen.

A rise in interest rates in the US, a slowdown in Chinese growth early this year and the low oil price were highlighted as key factors in the slowdown.

However, the FAI said the slowdown in the rate of recovery will end and that the pace of the recovery will improve in the coming year.

Grant Allan, the FAI deputy director, said despite the slowdown, expectations of growth have remained broadly positive.

“We await the GDP figures for the third quarter of 2015, and following only slight growth of 0.1 per cent in Q2, we will then learn whether growth through last year will be at the moderate levels forecast earlier in the year.”

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