“Moreover, if all conditions are met, construction on the first multi-billion-dollar liquefied natural gas terminal could start in 2016, and that would be a game changer for the province, providing a considerable boost to the economy”, it said.
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The Conference Board prediction is based on oil prices slowly recovering, but not exceeding US$55/barrel. “Growth in these sectors more than offset a decline in business investment and ongoing weakness in the energy sector”. The manufacturing sector is expected to grow by 1.9 per cent in 2015 and 3.4 per cent in 2016.
The Conference Board expects Nova Scotia’s manufacturing sector to see “robust gains” in 2016 and 2017, and cites work taking place on the Arctic patrol vessels by Irving Shipbuilding Inc.in Halifax as a reason behind the optimism.
The Board says even though the Alberta will continue to feel the impact from low oil prices, the economy is expected to grow by 1.2%.
Modest gains in employment combined with an increase in the labour force resulted in a mild rise in unemployment in the second half of 2015 to 7.1 per cent. However, this only shifted the unemployment rate from a below-trend level to one that is close to its long-term average.
“Difficulties in the energy sector, along with severe drought and forest fires, took the wind out of Alberta’s economic sails this year”, Marie-Christine Bernard, associate director for the provincial forecast, said in a news release.
The Conference Board said low oil prices led to a 15.2 per cent drop in energy investments this year and will mean $11 billion less in the province’s economy by the end of next year. The biggest driver will be the construction industry, the report said. Government expenditures announced to date are expected to boost real GDP by 0.4 percentage points in 2016, with further upside if the government enacts additional stimulus measures in its 2016 budget.
Saskatchewan and Newfoundland and Labrador – two other resources-heavy provinces – should also see improvement over the next two years.
Real GDP growth is expected to reach 2.5 per cent in 2016 and 3 per cent in 2017.
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Manitoba could overtake Ontario in 2016, with the output reaching 2.5 per cent – up from 2.1 per cent this year – and accelerating to three per cent in 2017, the board forecast. “The bright outlook for the province is largely thanks to the construction industry”.
