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News Release: Business Council of BC releases Top Economic Questions for 2014 with Council Predictions
Business Council of BC releases Top Economic Questions for 2014 with Council Predictions
December 30, 2013 (Vancouver, BC) – On the eve of a New Year, the Business Council of British Columbia has released its Top 10 Economic Questions for 2014, including predictions from the Council’s senior leadership and policy team. The questions and answers highlight the pressing issues facing the province and will help shape BC’s economic fortunes for the coming year.
While the Business Council predicts a respectable 2.4% GDP growth for the province in 2014, up from the estimated 1.5% GDP growth for 2013, there are many factors at play in the BC economy which will impact British Columbia’s job and investment climate.
Highlights from the Business Council’s Top Ten Economic Questions for 2014 include (in no particular order):
LNG - will the industry's development advance and become a reality in BC?
- Several LNG proponents are seeking to advance major projects in the province.
- The evolving global marketplace and stiff competition for expanding markets from a large number of other LNG supplier countries complicate the decision-making process for these multi-billion dollar investments.
- A number of factors, however, do put BC in the game, including a world-class upstream resource with a development track record, a stable political and economic environment, geographic proximity to markets, and broad stakeholder support for the projects.
Business Council prediction: Government is (rightly) highly motivated to see the LNG sector advance and is expected to establish a fiscal and policy framework that will support LNG development. At least one positive FID will be made next year.
Housing prices – will the market cool or accelerate?
- Defying many prognosticators, the housing market in BC marched forward again in 2013. Sales activity is on course to rise 5% this year, with average prices up by a similar amount.
- As the past year progressed, the market strengthened, but recently sales have slipped. The recent softening likely reflects the weak job market, a rise in mortgage rates, slower population growth, and a tightening of federal mortgage lending policies – all of which are dampening demand.
Business Council prediction: In spite of these headwinds, the Business Council expects another 5% or so increase in home sales in 2014, coupled with a slight rise in the average price. While we anticipate two consecutive years of sales increases, it should be noted that sales activity in 2014 will still be significantly below the 10 year average.
Economic Growth - will economic growth accelerate in BC?
- We estimate that BC’s economy will have grown by just 1.5% (real GDP) in 2013.
Business Council prediction: Although the first quarter may start off slowly, BC’s economy will gain momentum as 2014 progresses. Favorable factors include the strengthening US economy, additional export growth, some improvement in tourism (in part due to the weaker dollar), a slight pick up in domestic consumer spending, and higher business investment spending. BC’s economy should tack on almost a full percentage point of growth and expand at a respectable 2.4% pace next year.
For the full list, which includes questions about the US economy, the declining Canadian dollar and the outlook for job creation in BC, visit the BCBC Blog, BC Business Matters at www.bcbc.com or click here.
Business Council of British Columbia