B.C. poised for strong economic growth in 2015 https://www.vancouversun.com/business/Editorial+poised+strong+economic+growth+2015/10712549/story.html
Editorial: B.C. poised for strong economic growth in 2015
VANCOUVER SUN JANUARY 8, 2015
Ask people their favourite month of the year and January is not often cited. But in this dark, cold and rainy month, there is a collective comfort to be taken from economic forecasts predicting a relatively robust 2015 for B.C.
As we bundle up and hunker down this month, grappling with onerous credit card balances that recall the holiday season, and still six weeks away from the appearance of the first snowdrop bloom in the Lower Mainland, British Columbians are learning this province could be the fastest growing in the country this year.
Ontario, too, is poised to do well, thanks to a lower dollar and plunging crude prices.
To some extent, B.C. and Ontario will be doing well by default, the result of the declining fortunes of the oil-producing provinces, Alberta, Saskatchewan and Newfoundland and Labrador.
But 2.6- or 2.7-per-cent growth for B.C. — projected respectively the Business Council of B.C. and the Conference Board of Canada — is nothing to complain about, and better than the 2.3-per-cent GDP growth of 2014.
Lower Mainlanders will continue to confront the highest housing prices in Canada and face the prospect of delays in the launch of an LNG industry. This is also a year that will include increases in BC Hydro bills, Medical Services Plan premiums and ICBC rates.
But larger forces have aligned in a way that stand to benefit the province.
The lower Canadian dollar is bound to boost B.C.’s tourism revenues, especially from Americans, whose economy is expected to do extremely well this year.
The buoyant U.S. economy will mean more B.C. exports flowing south, a situation that will cushion the province from slowing exports to China, which has been experiencing lower growth.
B.C.’s forestry sector is anticipated to do well thanks to the Americans’ continuing housing recovery. And several new mines are expected to start operations in B.C. As well, Seaspan is benefiting from federal shipbuilding contracts.
Declining crude prices should yield a positive net benefit for B.C., which produces little oil and whose companies and consumers will save on fuel and heating costs.
The drain of people heading to Alberta for oil-related opportunities is expected to be curtailed so a trend of positive in-migration to B.C., which was renewed last year, almost certainly will continue.
B.C.’s government is on track to deliver a balanced provincial budget this spring, one of few provinces in the country that have had success in putting their ledgers in the black these past few years.
British Columbians cannot afford to become cocky, as oil prices could rebound by the end of the year, and interest-rate increases forecast for the second half of 2015 could pose real challenges for consumers and homeowners.
Besides, even 2.7-per-cent growth does not put B.C. in the league of Alberta-style growth of the past few years, averaging 3.5 per cent annually.
But as the year begins and we await the longer days and warmer temperatures, the notion B.C. soon could become the fastest-growing Canadian province makes January just a little easier to bear.
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