OTTAWA, May 10 /CNW Telbec/ - Propelled by a stronger domestic economy and a rebound in the auto industry, Ontario's economy will rise from the ashes in 2010 to share top spot in provincial economic growth with British Columbia, according to The Conference Board of Canada's Provincial Outlook - Spring 2010.
"There are clear signs of economic recovery from coast to coast," said Marie-Christine Bernard, Associate Director, Provincial Forecasting. "The improved domestic economies of Ontario and B.C., along with increased demand from the United States, will support a strong rebound in both provinces. However, the rebound will be gradual for most other provinces, spreading over the next two years."
A homegrown recovery is already underway in Ontario. Average housing prices have long since surpassed their pre-recession levels and employment has risen since the second half of 2009. Bolstered by stronger labour markets, Ontario consumers will resume purchasing big-ticket items. In all, Ontario's real gross domestic product (GDP) will increase by 3.8 per cent in 2010.
British Columbia's economy is also expected to expand by 3.8 per in 2010, fuelled by a one-time Olympics boost and recovery in the forestry, manufacturing and construction sectors. However, with the Olympic stimulus out of the way and growth in the housing market expected to ease, the province's GDP growth will moderate to 2.8 per cent in 2011.
Alberta will benefit from a revival in drilling activity and stronger capital investment in the oil sands, but continued weakness in job creation will limit economic growth to 3.3 per cent this year.
Saskatchewan's economy is again firing on all cylinders and real GDP is expected to increase by 3.5 per cent this year. The potash industry is slowly recuperating as global demand resumes for fertilizers. The agricultural sector is also expected to fare better this year.
Manitoba's economy will benefit from a recovery in agriculture and manufacturing, as well as a mini-boom in nickel, copper and gold mining. But the province's outlook will be tempered by a drop in construction activity, and real GDP is expected to expand by 2.2 per cent in 2010.
Quebec's economic recovery is stronger than previously anticipated, with real GDP expected to advance by 2.6 per cent this year. The domestic economy is improving, as Quebecers are back in shopping malls and rushing to buy houses.
A host of major construction projects will compensate for weakness in Newfoundland and Labrador's offshore oil industry and the impact of a labour dispute in the mining sector. Growth of 2.4 per cent is forecast in 2010. Next year, the province is expected to lead the nation in growth, due to a brief upswing in offshore production that will boost GDP by 4.5 per cent.
Nova Scotia's economy will continue to benefit from the $800 million in infrastructure stimulus spending by the government. In addition, a revival in consumer demand will help lift growth in real GDP by 2.2 per cent this year. In Prince Edward Island, a steady stream of government public infrastructure spending will boost the economy by 2.2 per cent.
A large drop in business investment and a modest recovery in New Brunswick's manufacturing sector will limit the province's economic growth over the next two years. With real GDP growth of 1.8 per cent, New Brunswick will post the smallest gain among provinces in 2010.
SOURCE Conference Board of Canada
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