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Scotland's economy continues to shrink

Official GDP figures show the decline has slowed to 0.8% - smaller than the last two quarters.

21 October 2009 11:01 GMT

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Scotland's economy continues to shrink

Scotland's economy has shrunk for the fourth successive quarter, according to new figures revealed on Wednesday.

However, the decline - 0.8% - is smaller than in the last two quarters, according to the official statistics for gross domestic product.

The latest figure, covering the period from April to June, is however, slightly worse than the UK decline of 0.6% for the same period. Overall the economy shrunk by 3.2% over the year, the same as the UK.

The figures suggest the plunge into recession which began last year is now slowing down. The previous quarterly fall, for the period from January to March, was 2.5%.

Output in the service sector fell by 0.4%, with declines in financial services, transport, storage and communications being partly offset by a slight growth in public administration and real estate.

In the manufacturing sector, metals and metal products were worst affected, falling by 8.5%, while chemicals and man-made fibres fell by 4.2%

But food, drink, tobacco, engineering and textiles all chalked up gains.

Finance Secretary John Swinney said: "While Scotland continues to have higher employment and economic activity rates than the UK as a whole, today's figures confirm that there is no room for complacency. We must continue to do all we can to position Scotland's economy for recovery."

He said the figures showed the Scottish Government was "absolutely right" to speed up capital spending to fight the recession.

He added: "We want the flexibility to be able to continue to accelerate spending into 2010-11 and will continue to press the Chancellor to use his pre-budget report to allow us to do just that and help us continue to support thousands of jobs in Scotland."

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