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| August 19, 2010 --- Vol. 04, No. 33 | August 2010
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Canada
ECONOMY – Canada’s three territories are expected to post strong economic growth this year, thanks to a rebound in global demand for commodities, according to report released Aug. 10 by The Conference Board of Canada. “A return to growth in the U.S. and global economies has helped diamonds, minerals, and metals regain their luster,” said Marie-Christine Bernard, the board’s associate director in the latest Territorial Outlook, a Centre for the North publication. “This increased demand for commodities has re-ignited mining production and exploration in the North.” The Northwest Territories will benefit from a surge in diamond mining production – its most important commodity. The market for diamonds was particular weak during the recession as consumer spending on luxury goods fell sharply, but diamond prices are approaching pre-recession levels. After contracting by close to 6 percent in 2009, real gross domestic product in the N.W.T. is expected to expand by 4.8 percent this year. Nevertheless, employment in the territory is not expected to pick up until 2011. The unemployment rate is expected to average 7 percent over the next three years, significantly higher than pre-recession levels. Yukon was one of the few bright spots in North America in 2009, as it led all provinces and territories last year with economic growth of 1.4 percent. This year, metal mining output is projected to increase and the construction industry will benefit from non-residential investments of more than C$400 million. In addition, industries that suffered during the recession, such as commercial services and retail trade, will begin to recover. All in all, real GDP is forecast to increase by 4.9 percent in 2010, although recent developments in the mining sector could pose some downside risk to overall growth. Nunavut’s real GDP is expected to expand by 12.9 percent in 2010, completely erasing last year’s decline of 10.6 percent. The contraction was due largely to the completion of the Meadowbank gold mine. This year, a rejuvenated mining industry and a recovery in construction activity will drive growth, according to the Conference Board. The large public administration sector will continue to stabilize the territory’s economy over the forecast period.
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