B.C.’s economic growth in 2013 will not rise above its 2012 performance, RBC is reporting today.
B.C. and Alberta are the only provinces that RBC does not expect to see growth in provincial GDP. For B.C., RBC is forecasting provincial real growth of 1.6% in 2013, down from 1.8% in 2012.
“A softer housing market, slower population growth and stalled job creation are all significant factors contributing to British Columbia’s economic slowdown,” said RBC senior vice-president and chief economist Craig Wright.
“Still, we are quite encouraged by the province’s recent external trade performance – thanks to rising demand abroad, we anticipate that B.C.’s natural resource sector will continue to grow and stimulate the economy.”
RBC noted that wood products exports have risen 35% so far in 2013. Exports of minerals, metals, machinery and equipment have also increased.
However, RBC’s report said that growth in the province’s domestic economy has not yet improved substantially. B.C. should not expect an injection of investment capital in 2013, according to Statistics Canada’s most recent Public and Private Investment Intentions survey.
Consumers continue to be hesitant about spending, leading to flat retail sales since 2011 in B.C. Underwhelming job creation is a likely contributor to this trend, according to the report. RBC expects export-driven activity to “eventually reignite private-sector job creation in the province.”
RBC said it does anticipate a rebound in 2014. It is forecasting a ramp-up in capital spending that will boost B.C.’s economic growth to a rate of 2.7% in 2014.
