THE economy north of the Border grew faster than the UK’s at the start of 2018, according to the latest data.

The Scottish Government issued revised figures for GDP in the first three months of the year showing it grew by 0.4%, twice the UK rate of 0.2%.

Scottish GDP growth, which was estimated in June to have been 0.2% in the first quarter, was uprated after statisticians incorporated fresh data and improved methods.

The Quarterly National Accounts Scotland (QNAS) also updated the last year of Scottish GDP growth from 0.8% to 1.3%. An uptick in North Sea growth and exports were partly responsible.

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Finance Secretary Derek Mackay said welcomed the figures.

He said: “It is hugely encouraging to see the Scottish economy grow by 0.4% in the first quarter of 2018, meaning that over the year since 2017 Quarter 1, the Scottish economy has grown by 1.3%.

The National:

“Figures for the first quarter of 2018 also show that manufactured exports, which make up around half of the total value of exports from Scotland to the rest of the world, have grown by 3.6%, reflecting the strength of international exports to the Scottish economy.”

However QNAS also revised GDP figures going back to 1998, and these showed some significant downward revisions to growth in 2014 and 2015.

A key factor was a massive correction for construction sector growth, which had been grossly overestimated. Previous growth of 34% over 2014 and 2015 was revised down to just 6%.

Overall, the changes meant Scottish GDP growth since 2010 is now below 1% a year, slightly lower than previously estimated.

Scottish Chambers of Commerce chief executive Liz Cameron said: “This is great news for Scotland, but concerns remain that the construction industry continues to experience falls in output, with GDP also remaining below historical growth trends.

“The upcoming Programme for Government presents a critical opportunity for the Scottish Government to invest in our national infrastructure, in order to jump-start our construction sector and provide the foundation for increased growth rates for the entire economy.”

The figures coincided with the latest inflation data showing UK prices grew by 2.5% in July, after three months at 2.4%, the first jump in the CPI measure since November.

The higher RPI measure of inflation, which includes housing costs, fell from 3.4 to 3.2%, setting the benchmark for rail fare increases in the New Year.

The Office of National Statistics said transport tickets, fuel and computer game prices drove up costs, while prices of women’s clothing, footwear, and some financial services fell.

QNAS put Scotland’s onshore GDP in 2017-18 at £156.5billionn, or £28,797 per person, or £170.4bn (£31,367 per person) when including a geographical share of North Sea oil and gas.

With the revival in the oil price, North Sea related GDP grew by 14% over the last year, with tax revenues rising from almost nil in 2015/16 and 2016/17 to £1.33bn in 2017-18.

Economist John McLaren of Scottish Trends said the revisions to the GDP growth trend had smoothed out previous anomalies, but said it was a concern the construction sector figures had been so badly off the mark.

He said: “The revised figures for Scottish GDP show a better performance of late than had been previously estimated but the post-recession performance remains poor, in fact overall worse than before. The huge revisions to construction output are a worry but at least seem to make more sense than the 34 per cent growth in two years that had been estimated earlier.

Such large and late revisions make it difficult to seriously analyse Scottish economic performance.”

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Scottish LibDem economy spokesperson Carolyn Caddick said Mackay was “getting rather overexcited” over growth of just 1.3% in a year, while Scotland’s productivity continues to lag.

“What the Scottish economy needs is a transformative investment in the services that allow everyone to make the most of their talents, like education and mental health.”

She added that spending money on these services would be better than setting any aside for a new independence referendum campaign.