Research and Publications

Alberta Economic Outlook March 2019

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Alberta's manufacturing industry performed well in 2018 with sales growing by 7.7 per cent over 2017. The gasoline, paper, wood product and electronic product manufacturing sub-sectors all saw above average growth. Manufacturing sales will likely continue to grow in 2019. Annual food and beverage processing remains on track. Shipments of manufactured food products increased in 2018 by 3.2 per cent and beverage manufacturing increased by 2.1 per cent. The price of Alberta's key agricultural products are weaker than a couple of years ago. After a frigid start to the 2019, farmers are likely keen for better conditions this year. Building permits in Calgary and Edmonton have been trending lower and aren't expected to grow in 2019. Announcements such as the latest $4.5 billion propane dehydration plant and polypropylene upgrading facility are positive, but a surplus of commercial and residential properties will keep the sector relatively quiet over the next couple of years. International exports remain clouded by uncertainty. In early March, China halted imports of canola from a major Canadian supplier, a move which is certain to worry agriculture producers and sellers. There are indications that the US and China may reach a deal on trade. Despite this, rocky trade relations between the world's two largest economies, the possibility of a no-deal Brexit and other global uncertainties will slow global growth this year. These factors could put additional pressures on Alberta's economy in 2019. Last year, retail sales grew 1.7 per cent, but sales are expected to pull back somewhat in 2019. Retailers may find 2019 particularly difficult especially as Alberta experiences job market uncertainty, soft consumer confidence and a continued expansion of online retail activity. The population is forecast to increase by 1.5 per cent this year with net interprovincial migration remaining positive. ATB is forecasting an annual net inflow of inter provincial migrants of between 2,000 to 4,000. 2

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