EDMONTON — No two economies are created equal, but there’s a pretty good consensus globally that business won’t come easy in the next year or so.
Western Canada, though, has always been a unique case. Because of the region’s energy riches — and the insatiable demand for black gold across much of the world — it’s been able to stay somewhat insulated from the manufacturing and financial market woes affecting the rest of Canada and much of the U.S.
Until now, that is. The global recession has been just that. Not only has demand for oil and energy products fallen off a cliff in the U.S., but even seemingly unstoppable economies like China’s and India’s have ground to a halt — not just in regards to their appetite for oil, but also for other raw materials and commodities the West is famous for.
While many transportation leaders are less than enthusiastic about the current economic climate, westerners, being westerns, are already eying the future and are planning how to hit the ground running when things do turnaround. But is its infrastructure ready for it?
The ability to respond to economic stimulus will largely rely on the quality of the infrastructure system enhancements being put in place. Just ask anyone using the roads in Fort McMurray, Alta., what can happen if infrastructure lags behind economic growth.
At a recent conference hosted by Westac, there was general agreement that when the economy does rebound, it will likely be different growth than in the past; but a turnaround nonetheless.
"The next 20 years will not look like the past 20 years in terms of growth," notes Chris Holling, executive managing director, global trade and transportation advisory services, IHS Global Insight. "Don’t get trapped into where we are now, but look forward to the key drivers of trade," he adds. "There will be recovery and the response from trade will come quickly."
So, back to the question: Does Canada’s transportation system — and the West’s particularly — have any game? Even though there’s still work to be done, there seems to be a "bring it on" sense of optimism around all modes of transportation.
Despite myriad impediments, including capacity constraints and labor disruptions affecting their operations, the railways and the coastal container handling industry are nonetheless buoyed about the future.
On a recent trip to China, Paul Waite, vice-president of CN Rail, didn’t get any sense that Canada’s Pacific trade reputation has a black eye. He said there was no mention of those issues by his hosts, which shows "the tremendous progress we’ve made."
China’s growth has slowed from around 12 percent a year to less than 5 percent; but it’s still growth and more than most advanced economies can match these days. Many speakers agreed the breather might actually be beneficial and give markets a chance to realign after unsustainable price increases. But it won’t last forever.
"China led us up, China led us down, and China will lead us back up again," notes Allen Wright, president and CEO of the Coal Association of Canada.
It’s no secret the investment in infrastructure over the past 30 years or so has been less than minimal in western Canada. But things are starting to change.
As for predicting a turnaround time for the western economy? One speaker quips, "the problem with forecasting is looking into the future."
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