Better days ahead for most provincial economies in 2014
OTTAWA, Dec. 9, 2013 /CNW/ - Over the past few years, we have seen a two-tiered economy in Canada, in which resource-rich Saskatchewan, Alberta, and Newfoundland and Labrador outperformed the rest of the country. Led by Alberta, most provinces can expect stronger economic growth in 2014, according to The Conference Board of Canada's Provincial Outlook: Autumn 2013.
"While many provinces have struggled in the past few years, Saskatchewan, Alberta, and Newfoundland and Labrador thrived as their primary resources were in high demand and fuelled solid economic growth," said Marie-Christine Bernard, Associate Director, Provincial Forecast. "However, the prospect of a stronger U.S. economy will now help boost exports and improve the outlook for other provinces over the next two years."
• Alberta will have the fastest growing provincial economy in 2014.
• Alberta has been the largest contributor to economic growth in Canada for three consecutive years, outpacing the much larger economies of Central Canada.
• B.C. is expected to lead economic growth among the provinces in 2015, with a projected increase of 3.1 per cent.
Despite the damage caused by the severe floods in June, Alberta's economy has grown at a fast pace in 2013 and economic conditions are extremely favourable heading into 2014. Buoyed by investment in the oil sands and a very strong labour market, Alberta's real gross domestic product (GDP) is forecast to expand by a robust 3.4 per cent in 2014.
Strong gains in the primary sector, a rebound in construction, and improved job creation will help lift British Columbia's real GDP by 2.7 per cent in 2014.
Following an estimated four per cent gain in 2013, Saskatchewan's booming economy can expect to cool next year. Weaker prices will hold back potash production increases and lower the province's economic growth to 2.3 per cent in 2014, in line with Canada's growth.
Manitoba's economy will expand by two per cent in 2014, fuelled by better performances in the province's goods and services industries, along with strong job growth and gains in personal disposable income.
Newfoundland and Labrador's real GDP growth will slow from a nation-leading six per cent in 2013 to 1.8 per cent in 2014. A much smaller increase in oil production and the completion of construction work on Vale's Long Harbour project will limit economic growth in the province.
The economic outlook for Central Canada and some of the Atlantic provinces is set to improve in 2014. Stronger growth in the U.S. economy will help improve export volumes and the manufacturing sectors in many regions.
A partial recovery in exports and strong growth in the commercial and financial services will help boost Ontario's economy. The province's economic performance is expected to be more in line with the national average in 2014, with real GDP forecast to grow by 2.2 per cent.
Quebec's economy will grow by 2.1 per cent in 2014, more than double this year's pace, due mainly to an increased willingness by consumers and businesses to spend.
Mining activity in New Brunswick is expected to pick up as new metal mines come into production in 2014-15, providing a boost to the province's economy. Overall, real GDP growth in the province is expected to be 1.6 per cent in 2014.
With the new Deep Panuke offshore natural gas field set to begin production and better growth prospects in the forestry and manufacturing sectors, Nova Scotia's economy is forecast to grow by 2.8 per cent in 2014.
Prince Edward Island had some of the strongest economic growth among all the provinces in 2013. However, a decline in private investment and ongoing fiscal restraint by the provincial government, will limit growth to just 1.3 per cent in 2014.
SOURCE Conference Board of Canada