OTTAWA, Ont. – Alberta is poised to once again lead the country in economic growth, according to the Conference Board of Canada’s Provincial Outlook: Spring 2017.
The report suggests Alberta will lead the way with the fastest growing provincial economy this year, with real GDP forecast expected to increase by 3.3%. B.C., which the board said would see a slight ease in growth this year, will tie Saskatchewan, nevertheless, for second place, with expected growth at 2.5%. Every province, with exception of Newfoundland and Labrador, are predicted to see economic growth in 2017.
“The difficulties in the resources sector are slowly dissipating and helping Alberta and Saskatchewan emerge out of recession,” said Marie-Christine Bernard, associate director of provincial forecast for the Conference Board of Canada. “However, the turnaround is still in its early stages and a full recovery will take time. Economic prospects are also improving across the country, but continued weakness in business investment—both in and out of the resources sector—could hurt economic growth in all provinces down the road.”
After two years of contraction, the Alberta economy will see a boost from non-conventional oil production thanks to new capacity coming online, the report indicated, while energy investment is expected to make a comeback this year and in 2018.
Alberta will also benefit from an improved labor market, consumer demand, the housing sector, manufacturing, and the rebuilding effort in Fort McMurray.
The energy outlook will also benefit Saskatchewan, and its adaption to lower oil prices has led to growing investment into cost-effective thermal extraction technology. Better labor markets will also help grow household spending in the province.
Manitoba’s economy is expected to expand by 2.1% in 2017 – a slight decrease from 2016 – thanks in large part to strong construction activity, and, as the spring outlook states, bright spots in transportation, equipment, manufacturing, and food processing.
Like Manitoba, B.C. will also see a minor contraction in its economic growth for 2017, expected to be 2.5%, down from last year’s 3.7%. A slowdown in the housing market will ease the brakes on employment, wages, and household spending, while the forestry industry will also struggle with new US duties on softwood lumber exports.
Ontario’s economy will slow slightly, growing by 2.3% this year; Quebec will continue its upward swing from last year, growing by 1.8% in 2017; the Atlantic provinces will see modest growth – Nova Scotia (0.5%), New Brunswick (1%), Prince Edward Island (1.8%) – with Newfoundland and Labrador retracting by 3%, but expected to bounce back in 2018.