Scotland’s economy continues to grow but minister warns of challenges ahead

Scotland’s economy grew faster than the UK as a whole in the final three months of 2019, figures published today revealed.

Output in Scotland's construction sector enjoyed modest growth in the final quarter of 2019. Picture: Getty

But the GDP figures for the period predate the outbreak of coronavirus in the UK, with ministers warning its impact could push growth into reverse.

Over the year, compared to the fourth quarter of 2018, the economy north of the Border has grown by 0.7 per cent. In 2019 the economy grew by a total of 0.8 per cent compared to 2018.

During the fourth quarter output in the construction sector grew by 0.7 per cent, output in production contracted by 1.2 per cent, and output in the services sector grew by 0.5 per cent.

Economy secretary Fiona Hyslop said: “The growth in the economy in 2019, although modest, is welcome. However, we are living in unprecedented times and I am acutely aware that COVID-19 is already having challenging implications for businesses the length and breadth of the country.

“Businesses receiving support are being encouraged to operate with fair work principles including supporting staff to self-isolate when they need to and if they have caring responsibilities.

“I have already met with business organisations and the STUC. A number of the issues that are to be addressed can be supported by the Scottish Government, but having spoken to Alok Sharma the UK Secretary of State for Business, Energy and Industrial Strategy, it needs to be understood that this will require a coordinated global and UK–wide level response to deal with the economic impact this will have.”

Scottish Labour said the statistics revealed that over the course of 2019, Scotland’s GDP grew by 0.8 per cent compared to 2018. Over the same period the UK’s GDP, as a whole, grew by 1.4 per cent.

Party leader Richard Leonard said: “Scotland’s fragile economy faces unprecedented challenges this year, both from Brexit and from the ongoing Coronavirus pandemic.

“It is of paramount importance that the SNP Government takes all action necessary to protect Scotland’s economy and it’s workers in the coming weeks and months. We need to pull out all the stops to avoid the economy going into recession.

“Scottish Labour is willing to work with the SNP government to develop the coherent economic plan that Scotland’s economy so badly needs in these uncertain times. Now more than ever is the time for the active state, working with unions and businesses, to plan our way out of this.”

The first indication of coronavirus on GDP is expected to be published in June.