Scotland suffers £3bn Brexit blow
The Scottish economy has suffered a £3 billion hit as a result of Brexit as uncertainty has led to a decrease in investment and growth, the Fraser of Allander Institute has found.
There are further warnings that the UK is facing one of the “hardest forms of Brexit” under the deal struck by Boris Johnson with EU leaders which will leave “considerable challenges” in the years ahead, according to the think tank.
The institute found that Scotland’s GDP has remained slow throughout 2019, with firms putting off investment as they await the outcome of the negotiations over the UK’S exit from the EU.
Mairi Spowage, Fraser of Allander Institute’s deputy director, said: “We estimate that the Scottish economy is around 2 per cent, or £3 billion, smaller than it otherwise would have been.“Some of this hit to Scotland’s economy may be clawed back as businesses see a clearer path ahead. But nothing within this Brexit process can be taken for granted.
“And whilst a deal to leave may soon be agreed, the nature of the UK’S future relationship with the EU is far from certain. Debates over Scotland’s future constitutional status are likely to intensify.”
Professor Graeme Roy, Institute director, said that leaving the EU with a deal could help lift some of the “fog of uncertainty” which has hung over the Scottish economy.
He added: “By avoiding a no-deal outcome, and all that would entail, growth is likely to move ahead of previous forecasts.
“However, the nature of the deal, and in particular the intention to move to one of the ‘hardest’ forms of Brexit, means that the long-term challenges for the Scottish and UK economies will be considerable.”
It was revealed in September that Scotland’s economy has fallen into a downturn after GDP fell by 0.3% between April and June, while unemployment has been steadily rising.