Donald Trump blamed for sluggish Scottish economy after tariffs slapped on exports
Donald Trump's decision to slap tariffs on exports to the United States has been blamed for the sluggish state of the Scottish economy.
Experts at the independent Fraser of Allander Institute today downgraded their forecasts for Scottish economic growth to just 0.8 per cent in 2025 and one per cent in 2026.
And the think-tank warned economic recovery from repeated covid lockdowns was weaker in Scotland than the rest of the UK.
They said poor growth was "largely due to higher global uncertainty" – linked "particularly" to the US President's trade tariffs.
Professor Mairi Spowage said: "After a strong start to the year, the Scottish economy has faltered in March and April and is essentially the same size in real terms as it was six months ago.
"Unfortunately, the wider business environment and global events are still taking a toll on businesses and consumers, which is having a dampening effect on spending and business investment."
It noted Scottish real GDP grew 0.4 per cent in the first quarter of 2025, compared to 0.7 per cent in the UK as a whole.
The think tank said: 'A pattern of lower growth in Scotland has persisted, leading to a weaker recovery from the pandemic than the UK generally.'
The report added: "The slowdown in growth this year is largely due to higher global uncertainty, particularly from the announcement of tariffs in the US and elsewhere.
"With the CPI (Consumer Prices Index) rate at 3.4% in May 2025 after staying below 3% throughout 2024, an uptick in inflation has also played a role."
Looking at the latest data, it found Scotland's economic growth had 'remained slow', with rises in the first months of 2025 having been 'partially offset' by decreases in March and April.
Tory MSP Craig Hoy said: "While there's no question external factors are impacting Scotland's economy, it's clear anti-business SNP policies are also stifling growth.
"The Nationalists' failure to fully pass on the rates relief available to businesses south of the border, coupled with them making Scotland the highest taxed part of the UK, explains why the growth rate here is even lower than the anaemic rate Keir Starmer is presiding over.
"Scotland is currently saddled with two disastrous, high-tax-low-growth, left-wing governments."
Deputy First Minister Kate Forbes said: "It is clearer than ever that Scotland's economy is being impacted by challenging global trading conditions and uncertainty – conditions mirrored across the rest of the UK.
"We are taking ambitious steps to grow the economy by pursuing new investment, building export potential and driving and capitalising on the Scottish innovation at the forefront of many key global industries.
"But we are doing all of this without the full economic powers needed to fully address the issues facing Scottish businesses. We need decisive action from the UK Government to counter the damaging economic impacts of Brexit and business uncertainty."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
18 minutes ago
- The Independent
Hamas says it gave ‘positive response' to US-backed Gaza ceasefire plan with Israel
Hamas has said it has submitted a 'positive response' to mediators regarding the latest US -backed proposal to broker a ceasefire with Israel, raising hopes of a possible breakthrough in the conflict, which has heightened humanitarian concerns in Gaza. Earlier, US president Donald Trump announced a 'final proposal' for a 60-day ceasefire in the war between Israel and Hamas, stating that Israel had accepted the 'necessary conditions' to end the hostilities. The plan envisages the staggered release of 10 living Israeli hostages held by Hamas, as well as the return of the bodies of 18 others, in exchange for Palestinian prisoners in Israeli jails and a halt to the bombing of Gaza. 'The movement has delivered its response to the brotherly mediators, which was characterised by a positive spirit,' Hamas said on its official website on Friday. 'Hamas is fully prepared, with all seriousness, to immediately enter a new round of negotiations on the mechanism for implementing this framework.' Israeli media reported that Israel has received Hamas's response, and it was being examined as prime minister Benjamin Netanyahu has yet to endorse the plan publicly. It comes ahead of Mr Netanyahu's expected meeting with Mr Trump in Washington on Monday. In Gaza, civilians continue to endure starvation-level conditions and relentless bombardment as the war nears its second year. People gathering to collect food and water have been targeted, as Israel's military campaign in Gaza has caused an acute shortage of basic supplies and pushed the population to the brink of starvation. The United Nations human rights office said that 613 Palestinians were killed within a month while trying to access humanitarian aid. Of those, 509 people were killed while trying to receive aid at distribution points run by the US and Israeli-backed Gaza Humanitarian Foundation (GHF). A Hamas official said the ceasefire under the new proposal could begin as early as next week, but added that further talks were needed to determine how many Palestinian prisoners would be released for each freed Israeli hostage, and to specify the amount of aid that would enter Gaza during the truce. Hamas wants aid to flow in greater quantities through the UN and other humanitarian agencies, an official told the Associated Press on condition of anonymity. The official also said that negotiations on a permanent ceasefire and the full withdrawal of Israeli troops from Gaza would begin on the first day of the truce, in exchange for the release of the remaining hostages. The last ceasefire between Israel and Hamas collapsed in March, and since then, more than 6,000 people have been killed in Gaza as Israeli forces intensified their attacks, worsening the humanitarian crisis in the enclave of two million people. Previous rounds of negotiations have stalled over Hamas's demands for guarantees that further talks would lead to an end to the war, while prime minister Netanyahu has insisted that Israel will resume fighting to ensure the destruction of the militant group. 'We'll see what happens. We're going to know over the next 24 hours,' Mr Trump told reporters on Air Force One late on Thursday when asked if Hamas had agreed to the latest framework for a ceasefire. The Hamas-run health ministry in Gaza has said the death toll in the Palestinian territory has surpassed 57,000. While the ministry does not distinguish between civilians and combatants, it reports that more than half of those killed are women and children.
Spectator
36 minutes ago
- Spectator
Labour's first year (in review) with Tim Shipman & Quentin Letts
Cast your mind back a year. Labour had just won a storming majority, promising 'change' to a stale Tory party that was struggling to govern. But have things got any better? In the magazine this week, Tim Shipman writes the cover piece to mark the occasion of Labour's first year in government. He takes readers through three chapters: from Sue Gray (freebies scandal and winter fuel cut) to Morgan McSweeney (a degree of professionalisation and dealing with the Donald) to the point at which 'things fall apart' (assisted dying, the welfare vote and Reeves's tears). On the podcast, Tim is joined by The Spectator's James Heale as well as sketchwriter and long-time Westminster mischief-maker Quentin Letts to go through the events and personalities that have contributed to the dysfunction. Listen for: Tim's run-in with Lord Hermer at the US Ambassador's bash; why Jeremy Corbyn's mooted political party could cause a chasm in the Labour party to rival the one tearing the Conservatives apart; who the targets for the chop might be, should there be a reshuffle; how young members of the Labour party are beginning their charm offensive on Angela Rayner; and why politicians have failed to grasp the banal fundamentals that make a great political performer. Produced by Oscar Edmondson.
Reuters
37 minutes ago
- Reuters
Trump says tariff letters to 12 countries signed, going out Monday
July 4 (Reuters) - U.S. President Donald Trump said he had signed letters to 12 countries outlining the various tariff levels they would face on goods they export to the United States, with the "take it or leave it" offers to be sent out on Monday. Trump, speaking to reporters aboard Air Force One as he traveled to New Jersey, declined to name the countries involved, saying that would be made public on Monday. Trump had earlier on Thursday told reporters that he expected a first batch of letters to go out on Friday, a national holiday in the United States, though the date has now shifted. In a global trade war that has upended financial markets and set off a scramble among policymakers to guard their economies, Trump in April announced a 10% base tariff rate and additional amounts for most countries, some ranging as high as 50%. However, all but the 10% base rate were subsequently suspended for 90 days to allow more time for negotiations to secure deals. That period ends on July 9, although Trump early on Friday said the tariffs could be even higher - ranging up to 70% - with most set to go into effect August 1. "I signed some letters and they'll go out on Monday, probably twelve," Trump said, when asked about his plans on the tariff front. "Different amounts of money, different amounts of tariffs." Trump and his top aides initially said they would launch negotiations with scores of countries on tariff rates, but the U.S. president has soured on that process after repeated setbacks with major trading partners, including Japan and the European Union. He touched on that briefly late on Friday, telling reporters: "The letters are better ... much easier to send a letter." He did not address his prediction that some broader trade agreements could be reached before the July 9 deadline. The shift in the White House's strategy reflects the challenges of completing trade agreements on everything from tariffs to non-tariff barriers such as bans on agricultural imports, and especially on an accelerated timeline. Most past trade agreements have taken years of negotiations to complete. The only trade agreements reached to date are with Britain, which reached a deal in May to keep a 10% rate and won preferential treatment for some sectors including autos and aircraft engines, and with Vietnam, cutting tariffs on many Vietnamese goods to 20% from his previously threatened 46%. Many U.S. products would be allowed to enter Vietnam duty free. A deal expected with India has failed to materialize, and EU diplomats on Friday said they have failed to achieve a breakthrough in trade negotiations with the Trump administration, and may now seek to extend the status quo to avoid tariff hikes.
