Alberta Nearly Catches Quebec GDP Even as Oil Started TumblingGreg Quinn
Alberta’s gross domestic product edged closer to overtaking Quebec’s last year, as the Western Canadian province coasted on momentum built up before the oil-price crash.
Alberta’s 4.4 percent output growth last year lifted gross domestic product to C$305.5 billion ($254 billion), while Quebec grew 1.4 percent to C$311.8 billion, Statistics Canada said Tuesday in Ottawa. The gap between the provinces narrowed to C$6.3 billion last year from C$44.9 billion five years earlier and C$50.7 billion a decade ago.
Alberta’s growth will decrease to less than Quebec’s this year as lower oil prices take hold, while over a longer term rising energy riches will help the western province overtake a Quebec economy tilted more toward manufacturing, said Robert Kavcic, a Bank of Montreal senior economist in Toronto.
“You are probably going to see Quebec outperform over the next two years,” Kavcic said by telephone. “But if oil prices grind back towards $70 by the end of 2016 as we are expecting, then I think probably looking three, four or five years out, you will see Alberta’s economy overtaking Quebec.”
Quebec’s economy will grow 2.1 percent this year and 2 percent in 2016, compared with Alberta’s gains of 0.4 percent and 1.9 percent, according to Bank of Montreal projections.
Alberta didn’t become a Canadian province until 1905 and didn’t make a major oil strike until 1947. It took several more decades before it was profitable to unlock the thick bitumen deposits that lifted Canada’s oil reserves to the world’s third largest.