The Scottish economy may have grown by its fastest rate in two years in the first quarter of 2019, but the risks to Scotland’s growth prospects have not gone away, says the University of Strathclyde-based Fraser of Allander Institute.
In its latest Economic Commentary, supported by Deloitte, the research institute highlights how much of the recent up-pick in growth is likely to have stemmed from firms implementing ‘no deal’ contingency plans. Underlying growth – particularly in key sectors of the economy – remains fragile.
Professor Graeme Roy, Director of the Fraser of Allander Institute, said: “Three years on from the Brexit Referendum, we still have little clarity over the timing or format of the UK’s departure from the EU.
“Given the scale of the challenges that a no deal Brexit might bring, it is no surprise that businesses are taking matters into their own hands by rolling-out contingency plans.
“Much of the Brexit debate has focussed upon the potential dislocation of trade patterns. But arguably an even greater challenge, particularly over the longer-term, are the implications for Scotland’s population.
“Our analysis shows that a significant amount of the long-term growth gap between Scotland and the rest of the UK can be explained by differences in population growth.
“Should Brexit make migration to Scotland more difficult, or less attractive, then this could have serious implications for key sectors and the economy at large.”
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Graeme is Professor of Economics at the University of Glasgow, and formerly Director of the Fraser of Allander Institute
Mairi is the Director of the Fraser of Allander Institute. Previously, she was the Deputy Chief Executive of the Scottish Fiscal Commission and the Head of National Accounts at the Scottish Government and has over a decade of experience working in different areas of statistics and analysis.
Adam is an economist at the FAI who works closely with FAI partners and specialises in business analysis. Adam's research typically involves an assessment of business strategies and policies on economic, societal and environmental impacts. Adam also leads the FAI's quarterly Scottish Business Monitor.
Find out more about Adam.
James is a Fellow at the Fraser of Allander Institute. He specialises in applied analysis of trade and climate change. His work includes the production of economic statistics to improve our understanding of the economy, economic modelling and analysis to enhance the use of these statistics for policymaking, data visualisation to communicate results impactfully, and economic policy to understand how data can be used to drive decisions in Government.
Ben is an economist at the Fraser of Allander Institute working across a number of projects areas. He has a Masters in Economics from the University of Edinburgh, and a degree in Economics from the University of Strathclyde, as well as experience working on a variety of projects for public, private, and third sector organisations. He also conducts work related to health, social care and criminal justice.