Scots economy ‘to lag UK for 3 years’ amid Indyref 2 uncertainty

SCOTLAND’S economy is set to lag behind the rest of the UK for the next three years as the country’s political uncertainty continues to ‘dampen’ investment, a new report reveals.

Experts claim a number of factors such as weak growth, declining confidence and the continued threat of another independence referendum are damaging the country’s economy.

The Fraser of Allander Institute yesterday published a bleak report suggesting Scotland could be dragged back into a recession within days. Earlier this year it was revealed that the country’s growth had contracted by 0.2 per cent, while the rest of the UK’s had grown by 0.7 per cent in the last quarter of 2016.

If the new figures show a further contraction, Scotland will have officially entered a recession again.

The Glasgow-based think-tank claimed that ‘uncertainty’ over political issues such as independence and Brexit were affecting the economy.

But experts said Brexit could not be used to explain the growing gap in growth between Scotland and the rest of the UK.

The report states Scotland is ‘stuck in a cycle of weak growth, declining confidence and poor investment and net export figures’ and that the SNP government can no longer use Brexit as an excuse for Scotland’s poor performance.

The full report has now been released which includes stark figures predicting Scotland’s economy will continue to lag behind that of the UK for at least three years. The think-tank’s report adds: ‘We expect uncertainty to dampen investment this year.’

Last night, Scottish Tory economy spokesman Dean Lockhart said: ‘Scotland’s economy continues to badly under-perform under this SNP government.

‘While the SNP will try to blame this decade-long under-performance on the oil price or Brexit, the reality is that the economy has been neglected by the SNP in pursuit of its single-minded obsession with independence. At a time when Scotland’s economy needs the full focus and attention of the Scottish Government, the SNP continues to plan for Indyref 2. Scotland has great potential, but this potential has been neglected by an SNP government whose priorities rest elsewhere. ’

The warning from experts comes only days after Nicola Sturgeon refused to rule out a second independence referendum, instead claiming that another divisive vote could be held within the next four years. Critics have continually claimed the constant threat of another vote is causing fear amongst businesses and investors and yesterday the report stated: ‘Uncertainty will continue to have an impact on the performance of the Scottish economy.’

A Scottish Government spokesman said: ‘As the report makes clear, the Scottish economy will strengthen across 2017 and the biggest threat to Scotland’s economy continues to be Brexit.

‘The UK Government must work with us and the other devolved administrations with the aim of keeping the UK and Scotland in the single market and the customs union.’

‘The economy has been neglected’