Growth forecast for just four provinces this year

March 5, 2009

http://www.vancouversun.com/business/fp/Growth+forecast+just+four+provinces+this+year/1356756/story.html

This article basically talks about how Saskatchewan, Manitoba, Prince Edward Island and New Brunswick are predicted to be the only four Canadian provinces to have growing economies this year, according to the Conference Board’s Provincial Outlook. According to the Conference Board's Provincial Outlook Director, Pedro Autunes, “No province is immune to the effects of the global recession, but the momentum in the domestic economies of Saskatchewan and Manitoba will cushion the blow from the downturn in the resource sector.” This basically implies that Saskatchewan and Manitoba will definitely get their fair share of the effects from the global recession; however, these two provinces will be safeguarded by their domestic economies. For example, Saskatchewan’s strong potash prices and infrastructure spending will bolster construction activity, thus labor markets will expand and provincial income tax cuts will keep retail sales growing at a healthy pace this year. Saskatchewan will again post the strongest growth among the provinces at 1.6 per cent. In Manitoba, large public and private capital projects, a resilient labor market and personal income tax cuts will be very beneficial to Manitoba’s 1% growth this year. Both of these provinces will be relying heavily on their domestic economies this year. In Prince Edward Island, the real GDP is expected to grow to about 0.6 per cent in 2009, since the province is preparing for the massive development of wind power energy on the Island. While in New Brunswick, $100 million in tax cuts and $1.2 billion in infrastructure spending over the next two years is expected to raise the GDP growth by 0.2% this year. The economic activity in 2009 is forecast ed to be a down year for the the other remaining provinces, however, all provinces are expected to bounce back in 2010, as the U.S. economy hits bottom and begins to recover.”

Connections to Introduction

The connections I make with this article and chapter 6 has to do with the term GDP. GDP is defined as the value of all goods and services produced in a given year. This directly relates to my article, because the whole reason why we are able to even know why these four provinces are showing signs of a growth in their economy is chiefly due to the GDP. If their wasn't GDP, then we would not be able to understand how much of a decline or an increase a province's good and services have done. In fact, the GDP is also one of the tools which we use to tell us whether or not a country is in a recession or not, because when a country GDP reaches negative growth, then that is basically when the country is declared to be in a recession. With the four provinces making positive growth right now, we can also easily predict that these four provinces will most likely be the first four to step out of the recession, and also these four will most likely be having the highest economic growth in 2010. This is also where the GDP is put to full use, because the GDP can easily tell us when the specific province started having positive growth, and also by how much has it improved or declined by. This is what makes the GDP so important to not just Canada, but to any economy.

Reflection

Personally, I think it's great to see that there are provinces in Canada that are now having beneficial GDP growth, because this also signifies that the entire country of Canada will also be rebounding in a distant future. For example, with the 2010 Olympics lurking around the corner, this will definitely help BC economy to start getting back on track. By 2010, I think Canada's GDP and economic growth will start producing healthy numbers again since many provinces are expected to have major improvements next year. With the winter Olympics, this will most likely help improve the economy in BC by a lot. In fact, I wouldn't be too surprise to see BC leading the way as one of Canada's highest GDP growth as of 2010.