British Columbia is expected to be the only province to grow by three per cent over each of the next two years, according to the Conference Board of Canada. The board’s provincial outlook, states that real GDP is forecast to grow 3.1 per cent this year and 3.6 per cent in 2016.
"The bright outlook for the province is largely thanks to the construction industry. A major investment in a LNG project could get underway if all conditions are met," said Marie-Christine Bernard, associate director, provincial forecast. "This would be a game changer for the province, providing a considerable boost to the economy."
If all conditions are met and regulatory approval is granted, construction on the Petronas $36 billion-dollar liquefied natural gas terminal could start as early as next year. This project is included in the conference board’s forecast. Beyond the resource sector, the province’s manufacturing, services and broader construction industries are all expected to contribute to growth. Vancouver’s real estate market continues to soar as local and foreign buyers fuel price hikes and transactions in the single-detached home segment.
The strength in the housing market is boosting the finance, insurance, and real estate industry, which will grow by 6.0 per cent this year and 3.3 per cent in 2016. The dynamic housing market is also leading to higher sales of durable goods, such as home appliances and garden equipment. Retail sales are poised to increase by 6.6 per cent in 2015 and growth is expected to remain above its 20-year average until at least 2019. Also supporting the fast pace of consumer spending is the improving labour market.
Job creation should be strong again in 2016 and 2017. Manufacturing is expected to provide a solid base for the provincial economy over the next few years. Wood product manufacturing will get a boost this year from healthy U.S. home construction, while production of the non-combat vessels for the federal government is expected to ramp-up at the Seaspan Shipyards in Vancouver. The province’s manufacturing sector is poised to grow by 4.2 per cent in 2015 and will average 2 per cent growth from 2016 to 2020.
It isn’t the only analysis putting B.C. at the head of the pack. CIBC World Markets, BMO and Central 1 have also released research indicating B.C. is set to lead the country’s economic growth.