World Economy

Scottish Economy Resilient

Scottish Economy ResilientScottish Economy Resilient

Scotland’s economy grew by 1.9% in 2015 and is set to continue to grow slowly, according to the chief economist.

Dr. Gary Gillespie said the economy was “resilient”, but warned that the pace of growth in 2015 was “significantly below” that of 2014, BBC reported.

Forecasts say a similar level of GDP growth should continue in 2016 and 2017 amid “challenging” conditions.

Economy Secretary Keith Brown said “fundamentals” like employment and productivity were “strong”.

Gillespie set out the figures in his tri-annual State of the Economy report. He said the economy “has been resilient over the past 12 months in the face of the most challenging external economic conditions in recent years”.

Annualized growth of 1.9% was below the UK-wide rate of 2.2%, and “significantly below” that recorded in 2014, which was 2.7%.

The drop in the price of oil and other commodities saw some sectors suffer and created difficult trading conditions for exporters.

However, the general service sector—which accounts for nearly 80% of output in Scotland—benefited from lower energy costs and improving consumer spending.

Gillespie said the construction sector also made “a significant contribution” to growth, in part thanks to “high levels of public infrastructure investment being maintained”.

He also described the labor market as “resilient”, with record levels of employment despite a slight fallback in the most recent figures, and unemployment “stabilizing” at about 6%.

 String of Opportunities

The chief economist said: “The attractiveness of the Scottish economy remains strong for business growth and inward investment, which will present continuing opportunities both in the short and medium term and areas impacted by external factors rebalance and create new opportunities.”

Brown said the figures were encouraging “in the face of extremely challenging global headwinds”.

He said: “We have to be conscious of the challenges we face, and conscientious in facing up to them—but we also have to be aware of our strengths and successes if we are to be able to build on them.”

Bryan Buchan, chief executive of the trade organization, said: “We appear to be marking time in terms of capital investment—partly due to market conditions arising from reduced activity in the UK Continental Shelf (offshore sector) and also in yet another tranche of uncertainty in terms of the imminent EU referendum.”