Four Canadian provinces to buck recession: report
TORONTO (Reuters) - Only four of Canada's 10 provinces will record economic growth this year, while a steep slowdown in the United States will hamper overall expansion, the Conference Board of Canada said in its winter economic forecast on Thursday.
The board stressed that no province will spared from the impact of the U.S. economic slowdown, given that Canada and the United States shares the world's largest trading partnership. However, two western and two eastern provinces will manage to grow this year, though not without difficulty.
In the Prairies, Manitoba and Saskatchewan have economies that are strongly reliant on agriculture, and this is expected to help carry them forward this year. Manitoba is expected to grow 1 percent in 2009, while Saskatchewan may lead all provinces with a 1.6 percent advance.
On the East Coast, New Brunswick is expected to stave off recession with 0.2 percent growth on the back of announced income tax cuts and infrastructure spending, while Prince Edward Island has major capital projects in the works that could push its economy up 0.6 percent, the board said.
"No province is immune to the effects of the global recession," said Pedro Antunes, the Conference Board's director of the national and provincial economic forecast.
Canada's economy has deteriorated sharply since the board's autumn report. Gross domestic product, one of the most recent pieces of domestic data, showed the economy shrank more in the fourth quarter of 2008 than at any time since 1991.
The deteriorating U.S. economy will have a heavy impact on Canada, which shares a trading link worth more than $1.5 billion a day with its larger neighbor.
Newfoundland and Labrador, Canada's easternmost province, is set to have the worst performing provincial economy due to the impact of declining offshore oil output. It will shrink by an estimated 2.6 percent, the Conference Board said.
Ontario, the manufacturing center of the country, will struggle because of weakness in the auto sector. The manufacturing woes will likely hurt Quebec's growth as well. Continued...