OTTAWA, March 8, 2016 /CNW/ - Following up on its solid performance of the last two years, B.C.'s economy is expected to grow by 2.7 per cent, outpacing all other provinces in 2016, according to The Conference Board of Canada's Provincial Outlook: Winter 2016.
"British Columbia posted the strongest economic growth last year and, thanks to widespread gains, is expected to lead the provincial growth rankings over the next two years," said Marie-Christine Bernard, Associate Director, Provincial Forecast.
- B.C.'s economy will outpace all other provinces this year, posting real GDP growth of 2.7 per cent.
- The province will experience broad-based gains in 2016.
- Aside from B.C., only Ontario, Manitoba, and Nova Scotia can expect to see their economy grow by more than 2 per cent this year.
- The slump in oil prices will continue to weigh on the economies of Alberta, Saskatchewan, and Newfoundland and Labrador.
The province's goods and service industries are forecast to grow strongly in 2016. This will encourage more Canadians—particularly those in the struggling oil-producing provinces—to move to British Columbia.
Solid demand for new homes will keep housing starts elevated at 32,700 units this year and next. With the inventory of completed units depleting, prices are still rising and the resale market is showing no signs of slowing down. This bodes well for the province's finance, insurance, and real estate industry, which is poised to post healthy gains over the next few years.
Seaspan Shipyards' multi-billion-dollar contract to build non-combat vessels under the National Shipbuilding Program will continue to bolster the province's manufacturing sector, as will the low Canadian dollar, which is helping exports. British Columbia's tourism sector is also expected to benefit from the low loonie, which in turn will support growth in the accommodation and food services industries.
The outlook for job creation is also bright, with employment forecast to grow by 2.2 per cent in 2016, up from 1.3 per cent last year. Accordingly, the unemployment rate will dip below 6 per cent in 2017. The strong job creation will help fuel household consumption.
The Conference Board's forecast includes Petronas' $36 billion Pacific NorthWest liquefied natural gas (LNG) terminal. However, the gap between LNG prices in North America and Asia has been closing rapidly, and there is still uncertainly as to if and when construction will begin. The project adds approximately one percentage point to our real GDP forecast for 2017.
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SOURCE Conference Board of Canada
Image with caption: "Real GDP by province in 2016 (CNW Group/Conference Board of Canada)". Image available at: http://photos.newswire.ca/images/download/20160308_C5345_PHOTO_EN_637506.jpg
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