Canadian capital spending will decline this year for the first time since the 2009 recession, led by a plunge in the oil and gas industry.
Planned expenditures by companies and governments on non-residential construction and machinery and equipment will drop 4.9 percent from 2014 to C$251.8 billion ($199.4 billion), Statistics Canada said Monday from Ottawa, based on a survey of 25,000 businesses and organizations. Investment plans by oil and gas, mining and quarrying businesses will drop 18.7 percent to C$67.9 billion.
Canada’s economy has been shrinking as a plunge in energy prices led companies such as Suncor Energy Inc. to scale back investment projects. Falling capital spending led output to contract in the first quarter, and Statistics Canada reported last week the economy shrank again in April.
In Alberta, the hub of Canada’s energy industry, investment plans fell 11.0 percent to C$82 billion.
The report showed private industry investment plans falling 7.0 percent and public sector plans down 0.2 percent.
The survey was taken from October 2014 to January 2015.