Scotland’s economic growth forecast outpacing rest of UK
Scotland’s economic growth will slow this year but still be ahead of the UK average, economists are predicting.
Forecasts by PricewaterhouseCoopers (PwC) say growth in Scotland is set to drop from 1.4% in 2018 to 1.2% in 2019, but this will still be ahead of the 1.1% forecast for the UK.
PwC then predicts that GVA growth — gross domestic product with taxes and subsidies taken into account — will increase to 1.6% in 2020.
Out of 12 nations and regions analysed by PwC, only the South East of England is expected to grow at a faster rate than Scotland this year while Scottish growth is expected to match London and the South West.
Lindsay Gardiner, PwC Scotland regional chairman, said: “In spite of the ongoing uncertainty over the UK’s future relationship with Europe, we are continuing to see investment in the private and public sectors, with City Deals funding across the country set to play an important role in Scotland’s near-term development.
“Scotland’s GDP grew by 1.4% compared to 2017, the same as the UK, so the outlook for the current year, in GVA terms, suggestions a slight contraction as macro-economic factors relating to Brexit come to a head, before growth accelerates to 1.6% in 2019.”
The forecast follows the latest GDP figures which showed a rise of 0.3% in Scotland from October to December – the eighth consecutive quarter of economic growth.
The rise was above the 0.2% recorded for the UK as a whole over the period, as the economy slowed.
And with official figures on Tuesday showing Scotland’s jobless rate at a record low of 3.4%, Finance Secretary Derek Mackay insisted the country’s
economy “continues to go from strength to strength”.
GDP figures estimated that the Scottish economy had grown by 1.4% in 2018 compared to the previous year – the same as the UK as a whole.
In the final three months of 2018 growth in services – which make up the bulk
of Scotland’s economy – and construction sparked the overall rise in GDP, with
theses sectors growing by 0.5% and 0.8% respectively.
However, the production sector shrank by 0.9% in October to December, with
agriculture, forestry and fishing down by 1.1%.