Page last updated at 12:38 GMT, Wednesday, 20 January 2010

Scottish economy shrinks by 0.2%

The construction industry has been among the hardest hit

Scotland's economy declined at the same rate as the UK from July to September, official figures show.

The third quarter saw the Scottish economy shrink by 0.2% after a fall of 0.5% during the second quarter.

Over the year to September, Scottish Gross Domestic Product (GDP), fell by 4.6%.

The construction industry has been among the hardest hit with a fall of 8.9% in the 12 months to the end of September.

Finance Secretary John Swinney said: "As global economic conditions improve, we are seeing a further easing in the rate of decline in Scottish GDP, with growth returning to parts of our economy.

"The decline mirrors a fall in UK GDP for the same period, while Scotland continues to have higher employment, lower unemployment and higher economic activity rates than the UK as a whole."

'Encouraging' signs

Although many sectors continued to decline in the third quarter, some areas saw a return to growth.

Retail and wholesale grew by 1.5%, while transport and the services sector also saw modest rises.

Responding to the latest data, CBI Scotland's director Iain McMillan said more recent surveys painted a more encouraging picture.

He added: "We may well be on the cusp of a modest improvement in business and economic prospects, though it is likely to be much later in the year before anything like meaningful growth resumes."

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