‘We see Alberta continue to outperform in the current environment. We’re calling it a speed bump in the faster lane,’ ATB chief economist Mark Parsons said
Heading into a new year brings a fresh outlook — and new challenges — for Alberta business operators.
Even with higher interest rates and questions about the Canadian economy, there are still reasons for optimism as 2024 approaches for business operators such as Mogens Smed, founder of Calgary-based construction technology company Falkbuilt Ltd.
“We will certainly be hiring at least another 50 or 60 people in the next six to nine months. No question about it.”
But what does the new year hold for Alberta’s mercurial economy, inflation-weary consumers and battle-hardened businesses?
That’s a question many business leaders and experts are contemplating with less than three weeks remaining in 2023.
Three new economic forecasts released over the past week paint a complicated picture of the Alberta economy, although a remarkably consistent outlook is anticipated for 2024.
A slowdown is likely, but it’s not a full stop on economic expansion, according to reports by RBC, Alberta Central and ATB Financial.
Alberta is expected to see among the strongest growth in the country next year.
Yet, the outlooks also caution that the province’s economy is decelerating with several challenges ahead, including the ongoing squeeze from higher borrowing costs and the potential for a hard landing for the Canadian economy.
“We see Alberta continue to outperform in the current environment. We’re calling it a speed bump in the faster lane,” ATB chief economist Mark Parsons said in an interview.
“We have higher interest rates going to next year . . . we see some weakness on the consumer side, but continued strength in other areas.”
ATB forecasts the provincial economy will grow by 2.1 per cent next year, down from 2.7 per cent expected in 2023.
After leading the country in economic growth in 2023, Alberta’s gross domestic product (GDP) will expand by 1.7 per cent next year, according to RBC Economics.
Continued population growth and robust energy prices should see the province outpace its counterparts, said Alberta Central chief economist Charles St-Arnaud.
“Alberta generally should do better than the rest of the country, but the question is: Where is the rest of the country?” he added.
“If Canada as a whole has a hard landing, then Alberta will have a hard time to escape that.”
Experts point to the economic tailwinds being generated by international and interprovincial migration, and solid commodity prices.
The province’s population increased by more than four per cent, or 184,000 people, for the 12 months ending in July, which is the highest rate recorded since the early 1980s, although it is expected to slow in 2024.
“A flourishing population, alone, won’t be enough to shield Alberta’s economy from moderating further in 2024,” the RBC report states.
RBC economist Rachel Battaglia points out that Alberta households remain heavily indebted compared to most other provinces, and there are signs consumers are responding to higher borrowing costs.
“We are still quite bullish on the Alberta forecast, but we are starting to see some of that weakness . . . so that’s why we have Alberta slowing down in 2024, before we have it ramping back up in 2025,” Battaglia said.
As usual, energy markets will be a big driver for investment in the province.
Global demand for oil and gas may slow in 2024 if the international economy weakens, although the startup of the Trans Mountain pipeline expansion next year is expected to shrink the price discount on Western Canadian Select heavy oil.
RBC is forecasting prices for benchmark West Texas Intermediate crude will average about US$78 a barrel next year, up slightly from this year’s level.
And there are other signs of strong capital investment, highlighted by Dow Inc.’s decision to begin construction next year on an $8.9-billion net-zero ethylene cracker and derivatives complex, to be built in Fort Saskatchewan.
“That’s a solid vote of confidence for Alberta to be attracting that kind of investment in this interest rate environment,” Battaglia added.
Meanwhile, sentiment for business operators has been improving, despite concerns around the state of the national and global economies.
The latest quarterly survey by Statistics Canada on business conditions, conducted between October and early November, found 62 per cent of Calgary business respondents are hopeful about their company’s outlook for the next 12 months, up from 58 per cent a year earlier.
Fewer businesses say they’re seeing labour shortages compared with a year ago, although rising inflation and higher interest rates are obstacles, noted the Calgary Chamber of Commerce.
“Businesses are more optimistic,” said chamber CEO Deborah Yedlin.
“Whether it’s energy, agriculture or other natural resources . . . we’re not going to be as affected by economic challenges in other parts of the country because of what we have here.”
Chris Varcoe is a Calgary Herald columnist.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
The Canadian Press. All rights reserved.
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.
Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.
The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.
“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.
“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”
Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.
The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.
The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.
Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.
More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.
Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.
“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.
Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.
“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.
Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.
Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.
Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”
“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.
This report by The Canadian Press was first published Sept. 18, 2024.
The Canadian Press. All rights reserved.
New Brunswick Premier Blaine Higgs expected to call provincial election today
Sutherland House Experts Book Publishing Launches To Empower Quiet Experts
Arch Manning to get first start for No. 1 Texas as Ewers continues recovery from abdomen strain
Alberta Premier Smith aims to help fund private school construction
Canada’s Probate Laws: What You Need to Know about Estate Planning in 2024
New Brunswick Premier Blaine Higgs kicks off provincial election campaign
Quebec won’t fund graphite mine project tied to Pentagon; locals claim ‘victory’
Former Canada captain Atiba Hutchinson tells his story in ‘The Beautiful Dream”
