Sask. poised for economic growth
Province will likely lead nation
Johnstone B 2011, ‘Sask. Poised for economic growth, Province will likely lead nation’, Leader-Post, 1 October.
Buoyed by high prices and strong demand for commodities, Saskatchewan is poised to lead the nation in economic growth again next year after posting a nation-leading 4.3 per cent economic growth in 2011, RBC assistant chief economist Paul Ferley said Friday.
"The province is fortunate in that everything is breaking in its favour, not only commodity prices that are key to the province, like oil and potash, but grains as well," Ferley said following his presentation to the Regina & District Chamber of Commerce.
"(Earlier this month) we boosted the growth (forecast for 2011) in the province. We were fairly confident about mining remaining strong, but earlier (this year) we were expecting no contribution from agriculture and that's after a very poor 2010 (crop). What we're seeing this year is a pickup (in agricultural production), reversing a lot of that weakness we saw in 2010."
Rather than production remaining flat in 2011, Statistics Canada is forecasting a 20 per cent increase production of the province's three main crops.
If anything, RBC's forecast of 4.1 per cent gross domestic product (GDP) growth in 2012 might be a little conservative, based on recent reports of more multibillion-dollar potash projects in the works, Ferley added.
He was referring to BHP Billiton Ltd.'s recently announced plans to build five new mines in the province like BHP's proposed Jansen project near Lanigan, which would be the largest potash mine in the world at eight million tonnes per year.
"Then there's the second round boost in spending that that entails," Ferley said. "You start enlarging some of these operations, or opening new mines, there's issues in terms of road access, housing for workers, support facilities for the families of these workers. All that infrastructure needs to be put in place, so that adds to capital expenditures."