CALGARY – The vast majority of indicators continue to tell a firmly upbeat story about Albertaâ€™s economic strength, as momentum gives no signs of easing, according to the latest RBC Economics Provincial Outlook released Thursday.
RBC forecasts Albertaâ€™s real GDP growth for 2014 will be 3.9 per cent, surpassing last yearâ€™s solid estimated pace of 3.7 per cent. It also forecasts growth of 3.5 per cent in 2015. In both years, annual economic growth in the province will lead the country.
â€œAlbertaâ€™s growth remains miles ahead of the pace in other provinces and we continue to expect the province will stand at the top of the provincial growth rankings both this year and next,â€� said Craig Wright, senior vice-president and chief economist of RBC, in a news release.
â€œMassive investment in energy and a strong population growth will continue to drive rapid economic expansion next year, though we do see mega-project investment and in-migration levels peaking and becoming slightly less powerful drivers of economic activity.â€�
The Canadian economy is forecast to grow by 2.4 per cent this year and by 2.7 per cent next year.
Albertaâ€™s current economic boom continues to be fuelled by the huge capital spending in the energy sector, said the RBC report, adding a recent inventory of projects reveals that work is underway on projects worth close to $63 billion in the oilsands and other oil and gas pipeline projects.
It said large-scale developments of Albertaâ€™s energy resources are generating substantial economic activity year-after-year in the province, though increasingly the story is about energy production.
â€œAs more and more megaprojects reach a production phase, crude oil output is rising rapidly in the province â€“ year-to-date crude oil production is up nearly 10 per cent in the province,â€� said RBC.
The report also said rapid population growth has emerged as another core component of Albertaâ€™s economic boom. Despite recent signs that net migration has started to ease, the number of people moving to the province remains at historically high levels. The provinceâ€™s population growth in the second quarter this year led the country at a very solid 3.3 per cent.
â€œMoving into 2015, Albertaâ€™s economic growth is expected to ease slightly, but remain at a robust 3.5 per cent rate,â€� said Wright. â€œWith persistent investments in energy sector and strong population growth driving the economy, we expect Alberta to sit atop the provincial growth rankings in 2015 yet again; however, we do anticipate the other provinces will somewhat narrow the gap.â€�