Manitoba manufacturing bucks national trend to boost economy, says RBC



    TORONTO, Jan. 11 /CNW/ - Strong fundamentals are working in Manitoba's
favour to support solid economic growth of 3.1 per cent for 2008, according to
the latest provincial economic outlook released today by RBC.
    "Large multi-year capital projects, a healthy manufacturing sector,
export growth, high commodity prices in several key agricultural sectors, and
improved crop conditions, have all combined to support ongoing growth in
2008," said Craig Wright, senior vice-president and chief economist, RBC.
"Manitoba continues its crucial balancing act with strong growth and modest
inflation."
    The province's unique manufacturing sector is faring well compared to its
counterparts in central Canada. Shipments are up ten per cent over a year ago,
led by primary metals, transportation equipment, and machinery and electrical
equipment. The aviation parts sector, and the fact that Winnipeg is the North
American centre for manufacturing inter-city and intra-city buses, has
provided solid support for its local manufacturing base and actually increased
manufacturing jobs last year in contrast to Ontario and Quebec.
    After a year of weak growing conditions, crop production bounced back in
2007, pushing farm cash receipts up sharply. The report noted that farm
incomes also rose as inventories continued to be sold off at elevated prices.
However, with the rally in crop prices, livestock producers are feeling the
pressure from soaring feed costs. While cattle prices are high, Manitoba's
crucial hog industry is suffering with excess production and weak prices.
    Across Canada, Alberta leads all provinces with above-average economic
growth, followed by Saskatchewan and Nova Scotia. On the opposite end of the
scale, and showing a complete turnabout with its mega-projects now in
maturation, Newfoundland and Labrador is posting the slowest economic growth
rate of 0.5 per cent, and on its heels is P.E.I., as well as Quebec and
Ontario with its manufacturing woes. However, a more bullish outlook is in
store by the end of this decade for Newfoundland and Labrador, New Brunswick,
Nova Scotia and, in particular, Saskatchewan, where there is a possibility for
a triple play of diamond mining, rich uranium deposits and a massive oil
strike in the southeastern part of the province.
    The RBC Economics Provincial Outlook assesses the provinces according to
economic growth, employment growth, unemployment rates, personal income
growth, retail sales, housing starts, and the Consumer Price Index.
    According to the report (available online as of 8 a.m. E.S.T., at
www.rbc.com/economics/market/pdf/provfcst.pdf), provincial forecast details
are as follows:

    
                       Real                Housing             Retail
                        GDP                 starts              sales

                                          Thousands
                  07     08     09     07     08     09     07     08     09
                  --     --     --     --     --     --     --     --     --
    NFLD.        9.0    0.5    1.0    2.5    2.2    1.9   10.0    6.0    2.0
    P.E.I.       1.9    1.2    1.4    0.7    0.6    0.5    9.1    4.5    3.7
    N.S.         2.4    3.0    3.5    4.8    4.5    4.1    4.4    4.9    6.5
    N.B.         2.5    2.5    2.6    4.1    3.8    3.4    6.7    4.5    4.0
    QUE.         1.9    1.7    2.5   49.4   46.9   40.4    4.4    4.0    4.1
    ONT.         1.7    1.4    2.6   68.1   66.2   60.2    3.9    3.5    4.7
    MAN.         3.4    3.1    2.5    5.7    5.7    5.0    9.0    5.3    3.4
    SASK.        4.6    3.8    3.3    5.9    6.1    4.5   12.2    8.5    6.5
    ALTA.        4.3    3.9    3.2   48.3   38.6   35.2    9.7    9.0    8.2
    B.C.         3.0    2.5    3.0   38.6   35.2   28.5    7.1    6.0    7.5
    CANADA       2.6    2.1    2.7    228    210    184    5.9    5.1    5.5


                     Employment              CPI

                  07     08     09     07     08     09
                  --     --     --     --     --     --
    NFLD.        0.7    0.1    0.3    1.5    1.0    1.2
    P.E.I.       1.3    0.4    0.2    1.8    1.3    1.6
    N.S.         1.3    1.8    2.0    1.9    1.1    2.0
    N.B.         1.9    1.7    0.9    2.0    1.2    1.6
    QUE.         2.2    1.2    0.9    1.6    1.1    1.6
    ONT.         1.6    1.0    1.1    1.9    1.0    1.7
    MAN.         1.5    1.2    1.5    2.2    1.7    1.6
    SASK.        2.3    1.6    0.8    3.0    2.4    2.4
    ALTA.        4.8    2.0    1.8    5.1    2.9    2.6
    B.C.         3.2    1.9    2.6    1.8    1.4    2.2
    CANADA       2.3    1.3    1.4    2.1    1.4    1.9
    




For further information:

For further information: Craig Wright, RBC Economics, (416) 974-7457;
Derek Holt, RBC Economics, (416) 974-6192; Amy Goldbloom, RBC Economics, (416)
974-0579; Jackie Braden, RBC Media Relations, (416) 974-2124


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