Scottish GDP grows by 0.7 per cent in Q1 2017

Scotland’s latest Quarterly National Accounts, announced today by Scotland’s Chief Statistician, show that during the first quarter of the year Scotland’s onshore GDP grew by 0.7 per cent in real terms, based on 2014 weights.

Over the latest 12 months, corresponding to financial year 2016-17, the value of Scotland’s onshore GDP is estimated at £150.0 billion in total, or £27,854 per person, in current prices.

Including a geographical share of UK extra-regio (offshore and overseas) economic activity, Scottish GDP is estimated at £159.4 billion in total, or £29,593 per person during financial year 2016-17.

The expenditure measure of onshore GDP shows that the increase in GDP over the latest year, in current prices (not real terms), was mostly driven by consumer spending, but with positive contributions also made by government spending, capital investment and net trade.

Manufactured Exports make up around half of the total value of exports from Scotland to the rest of the world (excluding oil and gas). The Index of Manufactured Exports (IME) increased by 7.2 per cent in volume terms during the first quarter of 2017. On a rolling annual basis, comparing the most recent four quarters to the previous four quarters, the volume of manufactured exports decreased by 2.8 per cent.

Over the year to 2017 Quarter 1, total consumer spending by the Household and Non-Profit Institutions Serving Households (NPISH) sectors is estimated to have increased by 2.5 per cent in current prices (unadjusted for inflation, not real terms)

Gross Disposable Household Income (GDHI) is estimated to have increased by 0.7 per cent over the year to 2017 Quarter 1 (in current prices, not real terms). The Household Savings Ratio is 4.5 per cent in the latest quarter, compared to an average value of 5.1 per cent during 2016.

Commenting on today’s data, Royal Bank of Scotland chief economist Stephen Boyle said: “Confirmation that Scotland grew strongly in the first three months of the year is very welcome following two years of weakness.

“The apparent stabilisation of the oil and gas supply chain is good news for a sector that has had to adjust to lower oil price. It seems likely that strong growth in manufacturing is a result of the resumption or expansion of production in petrochemicals and metals.

“Beyond these sectors, growth in the dominant services sector – three quarters of the economy – was a more modest 0.4 per cent q/q. As in the rest of the UK, services in Scotland will have been affected by the squeeze on consumers’ spending that results from higher inflation and weak wage growth.

“That’s likely to help explain why output in retailing and hospitality fell in Q1.”