MONTREAL, June 20 /CNW Telbec/ - Sébastien Lavoie, economist of
Laurentian Bank Securities, has disclosed this morning the Provincial Economic
Outlook for 2008, 2009 and 2010.
A Cold Breeze From The South Hits Quebec
LBS Economic Research predicts that the Quebec economy will expand by
less than its usual cruising speed in 2008 and 2009. The economy is expected
to progress at a pace of 0.8% in 2008 and 1.7% in 2009, below the average
annual growth rate of 2.0% experienced between the 2001 and 2007. The Quebec
economy will continue to endure the effects of the US economic slowdown.
Chances are that economic growth in the US will remain soft for quite some
time as a result of the deterioration in the housing market, lower consumer
confidence and tight credit conditions.
Even though 2008 will mark the trough of the cycle, we are far from a
recession similar to the early 1990's. Quebec holds several cards that will
enable it to avoid a recession. Among them, consumer spending will continue to
drive the train, supported by tax relief and a healthy labour market. Another
backbone of economic growth is non-residential investment. Mining and energy
exploration are also picking up speed, amid the lofty price of commodities. As
the US economy starts to pick up some steam in 2010, La belle province will
get back to its cruising speed, with an expected economic growth rate of 2.3%.
North American Slowdown To Hit Other Provinces Too
The slowdown in economic growth is not unique to the province of Quebec.
Elsewhere in the country, growth is also slowing, even in Western Canada.
Quebec is poised to performe better than its neighbour Ontario, where we
observe a skidding of the automobile industry. LBS Economic Research forecasts
the economic expansion in the largest province to be the weakest in Canada.
It's not big news that economies in Central Canada are not performing as
well as in Western Canada. 2008, 2009 and 2010 won't be an exemption to the
rule. Having said that, the years of super-charged economic growth in Alberta
appear behind us. The extreme buoyancy seems to be over even though the price
of oil doubled within the last year. The increase in royalty rates led to a
major decline in drilling activities. Alberta is giving way to "Saskaboom" as
the leader in growth among the Western provinces. Key producer of potash,
uranium, and crops worldwide, Saskatchewan's economy should grow at a sizzling
pace close 3.0% this year and next. Manitoba is also well positioned to
benefit from the boom in agricultural prices.
On the Pacific Coast, British Columbia benefits from companies in the
energy sector exploring the province's north-east province for shale gas. It
remains to be seen whether in the next few years, these explorations will lead
to investment projects, which is the key to generate a regional economic boom.
Still, the BC economy is poised to perform relatively well until at least 2010
Olympics, led by strong retail sales, solid wage growth, and a robust housing
market. British Columbians are enjoying the best economic period since the
boom of the late 1980s
In the Atlantic region, Newfoundland & Labrador has gone from being the
poor cousin of Confederation to becoming the rich cousin, thanks to the energy
boom. By 2009-10 this province should no longer receive equalization payments.
Things are also going quite well in Nova Scotia, which will soon be announcing
an agreement with Ottawa pertaining to a retroactive payment related to the
exploitation of its natural resources. Economic growth in Nova Scotia and PEI
should be reasonable overall since they are relatively less exposed to US
demand than the rest of the country. The full report is on Laurentian Bank
Securities Economic Research web site:
About Laurentian Bank
Laurentian Bank of Canada is a banking institution operating across
Canada and offering its clients diversified financial services. Distinguishing
itself through excellence in service, as well as through its accessibility,
the Bank serves individual consumers and small and medium-sized businesses.
The Bank also offers its products to a wide network of independent financial
intermediaries through B2B Trust, as well as full-service brokerage solutions
through Laurentian Bank Securities.
Laurentian Bank is well established in the Province of Quebec, operating
the third-largest retail branch network. Elsewhere throughout Canada, it
operates in specific market segments where it holds an enviable position.
Laurentian Bank of Canada has more than $18 billion in balance sheet assets
and more than $15 billion in assets under administration. Founded in 1846, the
Bank employs close to 3,400 people.
For further information:
For further information: Manon Stébenne, Senior Manager, Medias and
Public relations, (514) 284-4500, extension 8232,