REGINA — Saskatchewan will see strong economic growth this year, second only to Newfoundland and Labrador, according to the latest provincial outlook from the Conference Board of Canada.
“Robust growth in both construction and mining will propel real GDP growth to 3.8 per cent in 2013, and strength in the goods-producing industries will bring employment gains of 3.6 per cent,” the Ottawa-based Conference Board said Wednesday.
Potash production is set to rebound strongly this year, with new contracts signed with buyers in China and India. In addition, PotashCorp’s Cory and Allan mine expansions are coming on stream this year.
Next year will see even stronger growth in potash production as the industry continues to expand production capacity. Uranium mining will also see growth accelerate over the next two years with the completion of Cameco’s Cigar Lake mine and ever-increasing demand from China and India.
Employment is forecast to grow 1.8 per cent next year. Robust income gains, low inflation, and low interest rates will support household spending, and Saskatchewan retailers will see healthy gains in the next two years.
Next year, economic growth will slow to 2.7 per cent, but it’s still good for fourth place among the provinces, behind Newfoundland and Labrador, B.C. and Alberta.
“The outlook for Saskatchewan over the next few years is also positive, as solid investment intentions and large resource projects under development will keep the Saskatchewan economy moving forward,” the report said.
“However, a recent decision by potash producer Mosaic to defer an expansion project due to high development costs and less favourable market conditions provides downside risk to Saskatchewan’s real GDP growth over the near term.”
Recently, Mosaic announced it would defer million-tonne expansions of its Belle Plaine and Colonsay mines, saving $2 billion.
“Nevertheless, other large investment in the potash industry, such as K+S’s Legacy mine project, will help fuel sound growth in the construction industry over the forecast period.”