Scottish secretary Jim Murphy today attacked the SNP over the economic woes facing the smaller of independent states previously hailed as the "arc of prosperity" by Alex Salmond.

Mr Murphy said Iceland, Ireland and Norway have now been branded the "arc of insolvency" after recent problems.

They had been heavily cited by the Nationalists in opposition as an example that a small, independent Scotland could follow.

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"Look at this arc of prosperity, what some commentators are now calling calling the arc of insolvency: Iceland, Ireland and Norway," Mr Murphy told a Sunday newspaper.

"Iceland as a country is on the verge of bankruptcy. Ireland is officially in recession. Ireland and Norway are trying to borrow from the US and Russia.

"That's not Scotland's destiny. Scotland isn't Iceland and it shouldn't be Iceland and as long as I'm doing this job, I don't want Scotland to be Iceland."

But the First Minister refuted Murphy's criticisms in an interview with BBC Scotland's Politics Show.

He said countries "large and small" were affected by the current crisis.

"Norway's latest forecast in the last few days for growth next year is just under 2%," he argued.

"There's nobody - nobody - thinks growth in the UK or Scotland is going to be 2%.

"Norway is doing extremely well in extremely difficult economic circumstances across the world.

"Would that we were in the Norwegian position, not two years ago, but right now."

Mr Salmond added: "This idea that the current economic circumstances is an argument against small countries is, I think, totally misplaced."

But a source close to the First Minister offered a more scathing rebuttal of Murphy's comments.

He said of Murphy: "His position is moribund. It's a redundant post and he is trying to make it look relevant. All the Scotland Office has done is bear responsibility for the Scottish election fiasco."

But he insisted: "This isn't the time for petty bickering. This is the time for decisive action. Everybody wants to see governments working together to lighten the burden on people's pocketbooks throughout Scotland."