Newfoundland and Labrador’s fortunes lie in the oil- and fish-rich ocean off its coast, says a BMO report.
“Investment in the oil and gas sector continues at a healthy pace, with construction of the Hebron project underway. Other projects such as White Rose, currently in its engineering phase, and a major discovery by Statoil in the Flemish Pass Basin are expected to contribute the economy in a great way over the coming years,” says Robert Kavcic, a senior economist at BMO Capital Markets.
And the prospects for fisheries, a foundation of the province’s economy, are also bright.
“Improved economic conditions globally, particularly in the U.S., have increased demand in the fishery market. Further, the decline in the relative value of the Canadian dollar has made fisheries exports more attractive globally and BMO’s customers who operate in this industry are poised to benefit,” says Carolyn Booth, senior vice president of BMO’s Atlantic division.
The Newfoundland and Labrador jobless rate sits at 11.6%, below the average of the past decade, and wages are growing at an above-average pace, says Kavcic. “This supports better trends in housing and consumer spending. Compared to the province’s Atlantic counterparts, retail sales were up more than 3% year-over-year in the first two months of 2014, despite negative population growth.”
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