By Chris McCall
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” 鈥 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: 鈥淎 pattern of lower growth in Scotland has persisted, leading to a weaker recovery from the pandemic than the UK generally.鈥 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鈥檚 economic growth had 鈥渞emained slow鈥, with rises in the first months of 2025 having been 鈥減artially offset鈥 by decreases in March and April. Tory MSP Craig Hoy said: “While there鈥檚 no question external factors are impacting Scotland鈥檚 economy, it鈥檚 clear anti-business SNP policies are also stifling growth. “The Nationalists鈥 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鈥檚 economy is being impacted by challenging global trading conditions and uncertainty 鈥 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.” To sign up to the Daily R ecord Politics newsletter, click here