Saskatchewan remains one of the top economic performers in Canada, according to the BMO Blue Book released today by BMO Capital Markets Economics and BMO Commercial Banking. Much like the U.S. Federal Reserve's Beige Book, the BMO Blue Book combines the expertise of BMO's economists with information on current business conditions provided to BMO's commercial bankers by local businesspeople.
"Real GDP is expected to grow 2.4 per cent this year, up slightly from a 2.2 per cent pace in 2012, with strong resource-sector activity helping to maintain above-average growth," said Robert Kavcic, Senior Economist, BMO Capital Markets. "Saskatchewan boasts the lowest unemployment rate in the country, and is the only provincial government boasting a surplus in fiscal 2012-2013."
Kavcic noted that the resource sector remains a key growth driver of growth in the region.
"Oil production is now running at about 170,000 barrels per day, spurred by activity in the Bakken, just south of Regina. While potash producers have scaled back output alongside weaker demand in China and India, the long-term prospects in the sector remain encouraging."
Construction activity is also a major growth driver, as homebuilders keep pace with a surging population. Non-residential activity is also firm - the combined value of non-residential permits in Saskatoon and Regina was $836 million in the 12 months through January, near the highest on record.
"Saskatchewan continues to be one of Canada's strongest economies; consequently we are seeing all kinds of positive news among commercial clients," said John MacAulay, Senior Vice President, Prairies and Central Canada, BMO Bank of Montreal. "Our agriculture clients, for instance, are showing strength with expanding farms and higher land prices. Plus, the cities are seeing an impressive increase in business opportunity as a result of rising population numbers."
The full BMO Blue Book can be downloaded at www.bmocm.com/economics.