As per a report by TD Economics, Alberta will be the only province in Canada to experience annual economic growth of more than 3% in each of the next two years. Alberta is expected to lead the way in 2014 and 2015 with sustained strength in the oil and gas sector along with rising activity in other sectors of the economy.
Economic growth rate in Alberta is predicted to be 3.5% in 2014 and 3.2% in 2015. Whereas economic growth for Canada is forecast for 2.2% and 2.6% in the next two years.
Alberta is also expected to see improvement in its healthy differential over the forecast period. This would be due to commodity prices remaining at historically high levels.
“With commodity prices expected to hold up at close to current levels, the differential in GDP per capita . . . between the commodity-rich provinces and the rest of Canada is forecast to edge up. In 2015, we estimate Alberta will record GDP per capita at $88,000, an advantage of $35,000 relative to the rest of Canada,” said TD Economics.
“While the focus remains on rising output and improved pricing in the oil patch, other sectors have also contributed,” said the report. “For example, manufacturing shipments, wholesale and retail sales have all increased at almost double the national rate on a year-to-date basis. Our outlook calls for continued broad-based strength across most sectors in Alberta, with the oil and gas sector remaining a key centrepiece of the expansion.”
“Activity in the manufacturing sector is also expected to remain robust reflecting solid performances in the machinery and chemical industries. Goods sector strength will continue to spill over into service sector industries such as wholesale trade and transportation and warehousing.”
However Alberta is not expected to continue with the recent breakneck pace of interprovincial migration. There will be a modest cooling in real GDP growth in 2015 due to slower population rise.
Source: Calgary Herald