British Columbia, Ontario and Manitoba will lead the nation in growth, as they are well-positioned to capitalize on rising export demand, notes TD Economics.
BRITISH COLUMBIA: Real GDP growth is estimated at 2.5 per cent in 2015 – more than double the national rate. Over the 2016-17 period, it should be just above two per cent annually. BC’s manufacturing sector had a nominal sales gain of close to five per cent through the first half of the year, according to TD Economics.
ALBERTA: Real GDP contracted 1.4 per cent in 2015, according to researchers. Growth over the 2016-17 period is set at around 1.4 per cent per year. Output in the construction sector is projected to contract by more than 20 per cent this year, largely reflecting a 25 per cent drop in non-residential and engineering construction. Housing starts are also forecast to decline by some 10 per cent this year. Construction activity is expected to decline over the 2016-17 period.
SASKATCHEWAN: Low oil prices are expected to lead to a 0.8 per cent contraction in real GDP this year. “Engineering construction is assumed to decline in 2015, in line with lower rigging activity,” TD Economics researchers said. Capital spending is anticipated to move lower next year before stabilizing in 2017.
MANITOBA: Solid gains in the manufacturing, construction and agricultural sectors should deliver real GDP growth of more than two per cent this year and over the 2016-17 period, according to TD Economics.
ONTARIO: Manufacturers are benefiting from low exchange rates and GDP will rise by two per cent as exports rise. A 2.4 per cent increase in real GDP is predicted for 2016, with growth projected at two per cent in 2017. Nominal GDP growth in Ontario is expected to average 4.2 per cent over the 2016-17 period, according to TD Economics.
The province has announced an aggressive, 10-year infrastructure investment program totalling more than $130 billion.
QUEBEC: Real GDP is expected to increase by 1.3 per cent (year over year). “A pull-back in activity in the province’s construction sector has weighed on economic activity so far this year,” noted researchers. TD Economics calls for new residential construction to move lower over the 2015-16 period before rising in 2017.
The Quebec Infrastructure Plan has allocated investment of $88.4 billion over the coming decade.
ATLANTIC CANADA: The dramatic drop in commodity prices that began last summer is continuing to impact development activity in Atlantic Canada, especially in Newfoundland and Labrador, noted the Atlantic Provinces Economic Council’s Major Projects Inventory, published in May. Research shows spending on major projects in 2015 is expected to total $13.3 billion in Atlantic Canada, down five per cent from last year.
“Spending for this year is up slightly in the three Maritime Provinces and down nine per cent in Newfoundland and Labrador,” said Patrick Brannon, APEC’s Director of Major Projects. “In Newfoundland and Labrador, weaker oil and iron ore prices are impacting the pace of development and activity on the Hebron oil project peaked in 2014.”