Alberta growth expected to continue next year, Conference Board of Canada says
Gordon Kent
Canada’s economy could do even better than expected next year if oil prices hold on to their current strength, the Conference Board of Canada says.
After two years of recession, the provincial economy is on track to rise by 6.7 per cent this year, the second-best performance in Canada after British Columbia, according to the non-profit research organization’s fall provincial outlook released Wednesday.
Growth is anticipated to moderate to 2.1 per cent in 2018 as increased interest rates reduce the pace of vehicle sales, investment in the energy sector shows little increase because most large oilsands projects are wrapping up, and there’s less new oilsands production, the report says.
While that forecast is down from the 2.4 per cent economic boost the Conference Board predicted last spring, it might turn out to be too cautious if the surge in West Texas Intermediate oil prices to about $56 (U.S.) a barrel holds up.
“Canada’s economic performance could well surprise on the upside once more … Recent strength in oil prices could help to maintain the momentum in drilling and push economic growth above what we are forecasting over the near term,” the report says.
“Oil prices have climbed higher this fall as global oil markets are more balanced, thanks to supply cuts implemented by the Organization of the Petroleum Exporting Countries and allied producers, including Russia.”
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