Economists predict slight rebound and moderate growth for B.C. economy in 2021 – The Tri-City News
VICTORIA — Finance Minister Selina Robinson said she’s encouraged by predictions that British Columbia’s economy will rebound this year and next.
Robinson heard Friday from economists on the province’s Economic Forecast Council who estimate B.C. is on track for real GDP growth of 4.7 per cent this year and 4.3 per cent next year, before growth slows.
The same measurement for the provincial economy in 2020 shows a 5.1 per cent decline, the worst contraction since 1980.
“We can see the light at the end, but we’re still in the tunnel,” Robinson said in an interview after the hearing from the council.
The council of economists from major financial institutions and business associations warned that the strength of recovery depends heavily on the rollout of COVID-19 vaccines.
Recovery is expected to escalate as the province reaches herd immunity and consumer activity increases, while work ramps up in areas like construction on resource projects.
All signs point to a strong recovery in the United States, which will also help boost B.C.’s rebound, several economists said during the session.
But Robinson also heard the recovery won’t be felt evenly, with certain hard-hit industries and low-wage earners tending to suffer the greatest ongoing impacts of the pandemic.
Women, people of colour and those without more than a high school education have fared worse than others, Robinson heard.
At the same time, the skilled labour market is expected to tighten, suggesting good government policy could involve investment in training, education and financial support for those transitioning to new industries, she heard.
“Obviously, here we are 10 months out and there are some doing really well and others being completely left behind,” Robinson said.
“What caught my attention was making sure that we’re investing right now in people, but also into the future.”
Online shopping will likely change retail in the long term, while struggling sectors like tourism may see a strong, if delayed, rebound thanks to pent-up demand for travel and leisure, Robinson heard.
The challenge will be to bridge the current situation to the time when there is herd immunity, while maintaining an active tourism sector, she said.
The minister said the next B.C. budget will focus on continuing to support British Columbians through the emergency of the pandemic while investing in the future.
The government will table its budget on April 20 after legislation passed in December allowed it to delay its introduction from the traditional date in February.
The B.C. government announced late last year that the deficit forecast had grown and the budget shortfall was expected to hit $13.6 billion this fiscal year.
The Finance Ministry predicted B.C.’s economy would decline by 6.2 per cent in 2020, but growth was expected to rebound to three per cent in 2021.
Liberal finance critic Mike Bernier said the economic forecast report makes clear there is much more work in store for the New Democrat government on the road to economic recovery. It begins with fixing “growing problems” in their current support programs, he said in a statement.
“The forecast council is doing important work looking ahead to the economic future of British Columbia, and that is certainly vital, but we cannot let the government forget about the here and now,” Bernier said.
He accused the government of fumbling the provision of economic support at nearly every turn, from delayed pandemic pay to a “botched” rollout for small and medium-sized businesses.
Of the $300 million set aside for B.C. businesses at the beginning of the pandemic, only $21 million has been distributed, Bernier said.
“We need to see (Premier) John Horgan and his government take immediate steps to fix their ineffective programs and provide people with the relief they need to make it through this pandemic.”
This report by The Canadian Press was first published Feb. 26, 2021.
Amy Smart, The Canadian Press
India's economy expands 0.4% in Oct.-Dec., ending recession – Alaska Highway News
NEW DELHI — India’s economy expanded by a weaker-than-expected 0.4% in the October-December quarter, which still allowed it to escape recession following large contractions in the two previous quarters during the coronavirus pandemic, the government said Friday.
The National Statistical Office projected an 8% contraction for the 2020-21 financial year, which ends in March. In January, it had projected a contraction of 7.7% for the fiscal year, following 4% growth in 2019-20.
It said fertilizer production rose by 2.7% in January, steel by 2.6% and electricity generation by 5.1%. Coal production declined by 1.8%, crude oil by 4.8% and natural gas by 2%, it said in a statement.
India’s economy contracted by 7.5% in the July-September quarter following a record plunge of 23.9% in the previous three months. The government had imposed a strict two-month lockdown across the country in March after the outbreak of the pandemic.
A country enters a technical recession if its economy contracts in two successive quarters. India’s recovery is expected to improve with a rise in consumer demand and investment.
India’s central bank, the Reserve Bank of India, is projecting gross domestic product growth of 10.5% in financial year 2021-22. The International Monetary Fund has projected 11.5% growth in calendar 2021.
The IMF estimated that the Indian economy contracted 8% in 2020.
EU's Economy Chief Calls for New Fiscal Rules to Aid Recovery – BNN
(Bloomberg) — The European Union’s fiscal rules should be adapted to allow for more spending to boost growth as countries struggle to pull their economies out of pandemic-induced recessions, according to the bloc’s top economic official.
EU Economic Affairs Commissioner Paolo Gentiloni, speaking at the European Fiscal Board’s annual conference on Friday, reiterated calls to withdraw public support very gradually in order to avoid a sharp rise in insolvencies. But he added that reducing debt loads will remain warranted once the crisis has passed.
The euro-area economy contracted by 6.8% last year and the European Commission forecasts growth of 3.8% for this year, with predictions hinging on virus containment measures starting to be eased toward the end of the second quarter. The bloc is beginning to discuss how they can start shifting from blanket support measures for their business and workers to more targeted ones.
“Given the context of a very deep, uneven recession and high uncertainty, I believe it would be wiser to err on the side of doing more, not less,” Gentiloni said on Friday. “With the previous crisis we saw how costly it was to turn off the taps too soon.”
Changing the Rulebook
The bloc’s fiscal rules were suspended when the coronavirus hit, and few believe they can ever return in the same form. They require countries to aim for budget deficits of less than 3% and debt burdens below 60% of gross domestic product. The commission expects those figures to be more than 6% and 100% for the euro area this year.
The rules were already set to be rewritten before the pandemic started, as they were frequently breached and there was little evidence they were contributing to either stability or growth. Officials say talks will likely resume in the second half of this year.
The new framework should include a special treatment for growth-enhancing expenditure, Gentiloni said, arguing that the composition of debt — and whether it includes spending on key areas such as infrastructure and education — should matter when assessing its sustainability.
“Our fiscal rules should be adapted to improve the composition of public finances and make sure that any new debt is good debt,” he said.
Still, reducing debt loads is likely to remain central to any new framework. While overly strict rules could lead to a “self-defeating adjustment,” Gentiloni said a “credible mechanism to steer debt onto a gradual and steady downward trajectory remains warranted.”
©2021 Bloomberg L.P.
New development offers luxury living in downtown Langley – The Tri-City News
Health Canada approves AstraZeneca's COVID-19 vaccine – Kamloops This Week
Canada more than doubles COVID-19 vaccine distribution this week – CTV News
Silver investment demand jumped 12% in 2019
Iran anticipates renewed protests amid social media shutdown
Galaxy M31 July 2020 security update brings Glance, a content-driven lockscreen wallpaper service
Real eState11 hours ago
B.C. real estate industry braces for postpandemic immigration boom – The Globe and Mail
Health20 hours ago
Canada sees good news about COVID-19 inoculations as doses arrive more quickly
Economy20 hours ago
Canada’s finance ministry calls report of CPPIB CEO’s overseas trip for COVID shot ‘very troubling’
Business22 hours ago
Canadian Imperial Bank of Commerce profit beats estimates on capital market strength
Real eState22 hours ago
RBC Adds Two “Severe” Risk Scenarios, Including Canadian Real Estate
Real eState8 hours ago
B.C. real estate industry braces for postpandemic immigration boom – The Globe and Mail
Health13 hours ago
CPPIB CEO Mark Machin steps down after getting COVID-19 vaccine in UAE – Global News
Media22 hours ago
Information posted on Chinese social media platforms could be used for 'hostile activities,' Bill Blair warns – National Post