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Scottish economy out of recession after third-quarter growth of 0.6% Scottish economy out of recession after third-quarter growth of 0.6%
(35 minutes later)
 
The Scottish economy moved out of recession between July and September, growing by 0.6%, according to official figures.The Scottish economy moved out of recession between July and September, growing by 0.6%, according to official figures.
The Scottish government said output in the services industries grew by 0.3%, but output in construction contracted by 0.4%.
During the same period, the whole UK economy grew by 0.9%, helped by spending on the Olympics.
On an annual basis, Scottish Gross Domestic Product (GDP) grew 0.4%.On an annual basis, Scottish Gross Domestic Product (GDP) grew 0.4%.
That was better than the UK economy as a whole, which only grew by 0.1% over the year, according to figures released by the Scottish government. The Scottish government said output in the services industries grew by 0.3%, but output in construction contracted by 0.4% during 2012's third quarter.
Scotland's return to growth during the third quarter of 2012 also outstripped the performance in the same period the previous year, when the economy grew by 0.4%. During the same period, the whole UK economy grew by 0.9%, helped by spending on the Olympics.
Finance Secretary John Swinney welcomed the news but warned that figures for the fourth quarter might not be so positive. That has been followed by a first estimate of GDP for October to December 2012 that indicated the UK economy contracted by 0.3%, threatening a triple dip recession
Statistics released last week suggested that the UK economy shrank by 0.3% in the last three months of 2012, which further fuelled fears that Britain could re-enter recession. Underlying the headline figures, the strongest growth in July to September was in manufacturing, up by 3%, while electricity and gas production rose 1.9%.
"These figures show that the Scottish economy has returned to growth after two quarters of contraction," said Mr Swinney. A fall in electricity generation had been one reason for poorer figures in the second quarter of the year.
"Scotland's improved economic performance compares well to that of the UK, where growth was supported by the temporary impact of the Olympics. Tourism did not perform as badly as feared last summer and, included in the figures for the "distribution, hotels and catering" sector, it grew by 1.1%.
"However, there is no room for complacency. Recovery remains fragile - demonstrated by last week's flash estimate of a contraction in UK output during Q4 2012 - and the UK government's continuing inaction risks a return to recession for the third time since the financial crisis of 2008." Deeper contraction
During the third quarter of 2012, production grew by 1.9%, within which manufacturing grew at 3.0%. The large business services and finance sector grew by 0.9%, but there were falls in transport, storage and communication - down by 1.5%.
Scotland returned to growth without the temporary uplift attributed to the London Olympics and Paralympics - estimated at 0.2% points for ticket sales alone. These latest figures also show revisions to estimates for previous quarters, indicating that the recession of last winter was shorter than previously thought.
There was a small amount of growth in the final quarter of 2011, up by 0.1%, whereas it had been thought to decline by 0.4%.
That was followed by a deeper contraction in the first three months of 2012 than initially reported, down by 0.5% compared with the previous estimate of 0.2%.
From April to June 2012, output fell by 0.1%, whereas it was previously thought to have had a deeper decline of 0.4%.
Finance Secretary John Swinney said: "These figures show that the Scottish economy has returned to growth after two quarters of contraction.
Budget priorities
"However, there is no room for complacency. Recovery remains fragile and the UK government's continuing inaction risks a return to recession for the third time since the financial crisis of 2008.
"In contrast, the Scottish government will continue to do all it can to strengthen economic growth and create jobs. Next week, we will conclude our negotiations with parties across parliament to deliver a budget for jobs and growth.
"Our budget prioritises construction, skills, employment and a green economic stimulus."
However, Scottish Liberal Democrat leader Willie Rennie thought the SNP administration could be doing more.
"The growth figures for Scotland are welcome, even if they are still behind the rest of the UK," he said.
"The message to the Scottish government is that it cannot afford to dither any further on getting capital investment projects up and running.
"They fell short by £300m this year with their Futures Trust and have declined to start identifying projects in 2014 to use the extra capital resources provided by the UK government."
Scotland's third-quarter growth of 0.6% was better than the UK economy as a whole, which only grew by 0.1% over the year.
That return to growth during the third quarter of 2012 also outstripped the performance in the same period the previous year, when the economy grew by 0.4%.