TORONTO, Dec. 12, 2013 /CNW/ - Strong diversification in Manitoba's
economy helped the province maintain solid growth in 2013, and is
expected to continue to do so in both 2014 and 2015, according to the
latest RBC Economics Provincial Outlook released today. RBC anticipates Manitoba's economy will finish 2013
logging an increase of 2.5 per cent real GDP growth.
In 2013, a robust increase in agricultural production has helped offset
persistent weakness in manufacturing. Following a 50 per cent jump in
wheat and canola production in 2012, November crop estimates suggest a
further 33 per cent increase in 2013, RBC says.
"Manitoba's economy benefited from a substantial grain and oilseed
harvest that helped offset continued weakness in the manufacturing
sector," said Craig Wright, senior vice-president and chief economist.
"Looking past 2013, however, exceptional weather conditions that drove
strong crop output are unlikely to persist and we are assuming
agricultural output will drop by 4.4 per cent in 2014."
The Provincial Outlook notes that despite flat manufacturing volumes in
2013, the strengthening U.S. economy and a slight depreciation of the
loonie will provide the sector with an additional boost. RBC expects
manufacturing output to increase to 3.5 per cent and 4.0 per cent in
2014 and 2015, respectively.
RBC indicates that the expected dip in agricultural production next year
will only be partly offset by a strengthening manufacturing sector
which will lower Manitoba's annual GDP growth to 2.3 per cent. A return
to positive agricultural growth in 2015 alongside continued growth in
the manufacturing sector will balance out a slowing in residential
construction, keeping provincial growth at a solid 2.6 per cent for
Investment activity, both residential and non-residential, continues to
be a bright spot for Manitoba's economy. RBC says that work continues
on a number of non-residential projects in Winnipeg including the
expansion of the RBC Convention Centre and an office, condo and hotel
complex in the downtown core. On the residential side, housing starts
are poised to strengthen to an annualized 7,500 in 2013, up from 7,200
in 2012 - a historical high for the province on an annual average
"In the past decade, we've seen an upward trend in population growth in
Manitoba, which played into stronger demand for housing," added Wright.
"However, new construction activity in the past two years could also be
attributed to households advancing purchases to avoid a tightening in
mortgage lending. We expect that starts will moderate to 7,000 in 2014
and 6,500 in 2015."
The RBC Economics Provincial Outlook assesses the provinces according to
economic growth, employment growth, unemployment rates, retail sales,
housing starts and consumer price indices. The full report and
provincial details are available online as of 8 a.m. ET today at rbc.com/economics/economic-reports/provincial-economic-forecasts.html.
For further information:
Craig Wright, RBC Economics Research, 416 974-7457
Paul Ferley, RBC Economics Research, 416 974-7231
Elyse Lalonde, Communications, RBC Capital Markets, 416 842-5635