Prince Edward Island's potato prospects brighten economic
outlook: RBC Economics
TORONTO, June 22, 2006 — According to the latest
provincial economic outlook by RBC Financial Group, Prince
Edward Island's economic outlook is expected to increase by
2.1 per cent in 2006 and 1.9 per cent in 2007.
"There are good indications that PEI is on track towards
a balanced budget for 2007, but for now it remains one of
only two provinces in a deficit," said Craig Wright,
vice-president and chief economist, RBC. "As the province's
two key industries - potatoes and tourism - begin to rebound,
the province's economic outlook is one of stability, allowing
it to reach its balanced budget goal."
There are encouraging signs for PEI's farming industry. After
a decline in potato acreage last year, which resulted in a
disappointing performance for the industry, potato prices
have recovered much of their value. Acreage is also not expected
to contract much further this year, adding to the good news.
According to the report, tourism activity continues to improve,
with air traffic up 29 per cent and non-resident Confederation
Bridge traffic up seven per cent. Building on this momentum,
PEI has launched a tourism expansion strategy that will aim
to increase the tourism revenue share of GDP from its current
state of 10 per cent, to almost 15 per cent by 2010.
While regional differences exist across the country, Canada
is well positioned to absorb global economic shocks as a result
of geographically diversified investments, a strong consumer
sector and sound fiscal policy. Newfoundland and Labrador
will be the provincial growth leader this year with activity
in the oil and nickel sectors driving growth. After Newfoundland
and Labrador, the strongest economies will be west of the
Manitoba-Ontario border for 2006.
The RBC Economics Provincial Outlook assesses the
provinces according to economic growth, employment growth,
unemployment rates, personal income growth, retail sales,
housing starts and the Consumer Price Index.
According to the report (available online as of 8 a.m. E.D.T.,
at www.rbc.com/economics/market/pdf/provfcst.pdf), provincial
forecast details are as follows:
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For more information contact:
Craig Wright, RBC Financial Group Economics,
(416) 974-7457
Derek Holt, RBC Financial Group Economics,
(416) 974-6192
Kathy Bevan, RBC Financial Group Media Relations,
(416) 974-8810
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