B.C.’s economy will grow 2.6% this year and 2.5% in 2012, according to a Conference Board of Canada forecast released this morning.
“To put it in context, the forecast for B.C. is relatively positive given that we’re still not seeing really strong recovery in the U.S. economy,” said Marie-Christine Bernard, conference board associate director, provincial forecast.
Bernard noted that forestry and manufacturing grew in B.C. this year, despite American economic woes.
“Those used to be very closely tied to the U.S. economy, but B.C. was able to diversify and export more to Asian markets, in particular China.”
But Bernard said B.C.’s economy is facing other challenges.
“What we haven’t seen, though, is consumer demand – it’s still very weak,” she said. “So we’re forecasting only modest growth in terms of retail sales for B.C. in 2012, so that will be a dampening factor for the province next year.”
She added both federal and B.C. governments are planning to scale back their infrastructure spending in the province.
“That will also be another factor that will be holding back growth.”
As to how the forecast fits into global worries about Europe’s debt crisis, Bernard said the Canada-wide forecasts are based on the idea that there won’t be a global economic crisis.
“Obviously there’s more risk than usual at this time for the forecast,” she said. “We aren’t a major exporter to the European Union, but we could be affected if there’s a global confidence crisis.”
Jenny Wagler
@JennyWagler_BIV