TORONTO, June 19, 2013 /CNW/ - Alberta's economy is positioned to grow
at the top-end of Canada's provincial economic growth rankings in 2013;
however, it is one of only two provinces, alongside B.C., that will see
a slight deceleration of its pace compared to 2012, according to the
latest RBC Economics Provincial Outlook released today. RBC forecasts a provincial real GDP growth rate of 3.0
per cent, down modestly from 3.8 per cent last year.
"We expect Alberta's economic boom to continue largely unabated this
year with the majority of indicators so far pointing to rapid growth.
Crude oil production is on an upswing, construction activity is rapidly
expanding, and, in the second quarter to date, housing starts are at
the highest level since early 2008," said Craig Wright, senior
vice-president and chief economist, RBC. "Attractive job prospects
continue to be a beacon for workers from outside the province, which
has boosted Alberta's population growth above the three per cent mark
for the first time since 2006."
The RBC report notes that oil production and delivery issues manifested
themselves in the heavily discounted prices that oil producers were
receiving in late 2012 and early 2013 - namely, an increase in energy
production in the U.S., pipeline bottlenecks and the 'bitumen bubble' -
creating uncertainty about the sustainability of Alberta's energy boom.
This uncertainty, however, has been alleviated in recent months, at
least temporarily, RBC says.
"An increase in use of rail cars to transport Alberta's unconventional
crude to refineries on the U.S. Gulf Coast have curtailed pipeline
bottlenecks, helping narrow the price differential between Alberta oil
and the WTI benchmark," said Wright. "So far in the second quarter of
2013, the Western Canada Select benchmark price rebounded an impressive
24 per cent, suggesting the low prices we saw earlier were not
The main restraining force in Alberta's strong growth has been the
manufacturing sector, where sales have stagnated. Still, RBC indicates
that the majority of economic indicators point to rapid growth in the
province this year and that broad-based economic expansion will
accelerate in 2014 to a rate of 4.2 per cent, enabling Alberta to
reclaim the title of Canada's fastest-growing provincial economy from
Newfoundland and Labrador.
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/market/pdf/provfcst.pdf.
For further information:
Craig Wright, RBC Economics Research, 416 974-7457
Robert Hogue, RBC Economics Research, 416 974-6192
Elyse Lalonde, Corporate Communications, RBC Capital Markets, 416 842-5635