Manitoba’s economic growth this year dogged by ‘uncertainty’: report

Manitoba’s economy is poised to grow 1.2 per cent this year, a report by Signal49 Research forecasts.

The firm formerly known as the Conference Board of Canada expects Manitoba will be bolstered by private-sector spending, largely in the mining sector and by public-sector projects over the next five years.

“Manitoba, it’s not unscathed from the trade war,” Richard Forbes, a Signal49 Research principal economist, said Thursday. “More … the uncertainty is affecting Manitoba than the direct trade impact.”

Forbes pointed to Alamos Gold’s Lynn Lake gold mine project and a consortium buying Vale Base Minerals’ Thompson nickel mine for up to $280 million. Global demand for minerals should benefit the Prairie province, Forbes said.

Signal49 Research also flagged demand from Asia and agriculture yields, as boons for Manitoba.

Public infrastructure spending adds to the government’s deficit, but it boosts the GDP by employing local businesses and workers, Forbes said.

“We’re pretty optimistic on Manitoba’s economy overall,” he said.

Signal49 Research expects the province to post job gains of 1.6 per cent this year. It’s assuming in its forecast the Canada-United States trade war will see some resolution in 2027.

But such a resolution may not come, noted Fletcher Baragar, a University of Manitoba economics professor who studies the province’s economy.

“That analysis didn’t really emphasize that the uncertainty this year is probably greater than a normal year,” Baragar said. “We just really don’t know (how it) could affect the Manitoba economy.”

He doesn’t anticipate real GDP growth straying far from 1.2 per cent this year. The Manitoba Bureau of Statistics released its own forecast last month suggesting 1.1 per cent growth.

GDP growth could drop — perhaps by tenths of a percentage point — if the trade war continues another six to 12 months, Baragar said.

Mineral prices make mining investment less of a sure bet, Baragar continued. He noted the provincial government will “have to reckon with” its deficit at some point, though it may not be in the near term.

Manitoba’s agriculture sector may be a highlight of the provincial economy this year, keeping that 1.2 per cent growth steady, Baragar said.

“Steady and relatively low interest rates combined with steady and relatively low unemployment rates … support consumer confidence,” he said, noting Manitoba has both, which is beneficial for the economy.

gabrielle.piche@winnipegfreepress.com