The Contraction Echo
Another Canadian bank has added its voice to the chorus that now says Saskatchewan’s economy will contract this year.
We’ve seen recent forecasts from the economics unit of various banks suggest this will be a down year for Saskatchewan with growth actually heading into negative territory. The general target for these forecasters has been two-tenths of a percentage point contraction in the provincial GDP or Gross Domestic Product.
Now the Bank of Montreal has updated its quarterly forecast and it too has us in contraction mode. However it is forecasting a drop of only one-tenth of a percentage point. Next year it is projecting a rebound and positive growth of roughly two percent, fourth best in the nation tied or ahead of Alberta and everything east of Ontario.
Given that only Alberta and Newfoundland are seeing steeper declines it is clear falling oil prices are the primary factor at play here. And even a modest improvement in oil prices or a slightly better than expected crop could be enough to push us back into the black by year’s end.
The new trade agreement is not really about business or labor – it’s about consumers.
For years there has been a movement to streamline the world of commerce in a bid to make products more affordable and accessible. Making life easier for the consumer will ultimately benefit business and labor as well.
These deals are not supposed to prop up non-competitive industries that have survived or been shielded by protection contained in legislation. Basically, consumers were charged more – and never transparently – to support these sectors.
That resulted in our competitors crying foul and us complaining about their rules. So the arrival of the TPP or Trans-Pacific Partnership – should it ultimately be ratified – is supposed to make it easier and cheaper for consumers – and their proxies in the market, commercial organizations – to get what they want.
This not unlike the push in Saskatchewan for Patient First, Citizen First or Student First where the idea is government is supposed to serve its constituents, not the other way around. TPP is the business version of that concept where its customer first.
A few hundred business people from Saskatchewan and across the country gathered in Saskatoon Friday to pay tribute to some of the country’s brightest innovators.
The event was put on by the Ernest C Manning Foundation which takes its show across the country each year. This was the first time it stopped in Saskatchewan.
The foundation – bearing the name of the former Alberta Premier – was established by some forward thinking Albertans more than three decades ago to single out the best in Canadian innovation. Designers, inventors and developers can submit their ideas for prize money – $100,000 for the principal prize – that will help them move their concepts along.
This year’s winners come from Winnipeg – a doctor and an engineer who collaborated to develop a tool for removing inoperable brain tumors. The Foundation also pays tribute to young people who are chosen from the best of the best in the national science fair. Four recipients – most of them in their teens – came up with everything from a smart bandage for treating burns to a cement for repairing damaged bones.
Anyone looking for some good news in the economy has been turning a blind eye to the energy sector and watching manufacturing in hopes of seeing something hopeful. But a new report says it too is having some issues.
One of the measures of manufacturing performance is the PMI – or Purchasing Managers Index – prepared by RBC Royal Bank. It surveys the procurement departments of major manufacturers to see if they are opening the order book or cutting back.
The latest one – for September – is negative for the country. At 50 the index is neutral. Above that the sector is growing and below signals a contraction. The September number was 48.6, the lowest in the survey’s history.
But Ontario was positive as was Quebec. BC and Alberta were hugely negative at 43. The ‘rest of Canada’ which includes Saskatchewan was positive. Whether Saskatchewan is closer to Alberta or Ontario is a good question but we and Manitoba are the largest players in the ‘rest of Canada’ equation and given that it was positive we are probably neutral to slightly higher.
Paul Martin You’ve heard him on the radio, seen him on TV and read him in newspapers and magazines. Paul is a popular keynote speaker on topics ranging from the economy to tapping community potential. His unique blend of communication and business knowledge has made him a highly sought-after consultant. As the Chair of Martin Charlton Communications, Paul is MCC’s ‘go to’ guy for all things business in Saskatchewan. He is the chair of four Saskatchewan branches of TEC (The Executive Committee) – a global organization dedicated to improving the performance and enhancing the lives of CEOs – which has over 50 CEOs and senior executives among its Saskatchewan members. The long and short: Paul knows the province’s corporate community and business economy like few others. He is a potent conduit for anyone looking to do business in Saskatchewan, Canada’s fastest growing economy. His strategic advice is unrivalled.