Withdrawal the No1 risk to the economy

BREXIT remains the main risk to Scotland’s economy, though growth is expected to increase this year, a report has found.

Economic growth is set to rise by 1.3 per cent this year, but this will be at a slower pace than predicted and behind the UK’s growth rate as a whole, according to the EY Scottish ITEM Club 2018 Summer Update.

The UK economy is forecast to grow by a slightly higher than expected 1.6 per cent this year.

The report said that Brexit remains the “main BY LUCINDA CAMERON risk” to the Scottish economy and that despite the first phase of exit negotiations being complete, there are still a number of key issues that need to be agreed between the UK and the EU, not least the Irish border.

It said that while uncertainty persists, business investment is likely to be lower than might have been the case.

Mark Gregory, EY’s UK chief economist, said: “The Scottish and UK economies are growing below historic trend rates.”