Correction:
Since posting the following article, the document that was
quoted on the government website has been removed from the
TD website. The TD informs me that it is just a coincidence
that it was changing its site. In any event, thanks to the
cached feature on Google searches, the
TD article from January 15 can be found by clicking here.
Unlike the version that I read from the TD website, the
cached version has provincial estimates on page 8 that are
consistent with the claim on the BC government website.
My apologies for thinking that the government would get
it wrong!
BMO
puts BC tied for Last
On January
28th BMO
Financial Group released its updated regional economic
forecast. You probably won't see that on the BC government
webpage because BMO predicted that BC will be tied for
dead last in economic growth in 2004. Its estimate for real
GDP has BC tied with Newfoundland & Labrador at 2.5%;
Alberta ranks highest at 4.0% followed by Quebec at 3.0%.
The estimate puts BC's GDP for 2003 at a paltry 0.9% growth.
It will be April before Statistics Canada produces figures
that can be used to check the bank's estimate of provincial
GDP for last year.
The government
website claims that the TD Bank's January 15 "Regional
Economic Outlook" forecast that "B.C. will have
the second-highest GDP growth of all ten provinces in 2004.
TD forecasts growth of 3.1% for BC this year, second only
to Alberta and ahead of the national forecast increase of
2.8%." There is an enormous difference between the BMO's
0.9% 2003 growth and the TD's 3.1%; there is also a big problem
finding what the BC government says is in the TD's January
15th publication. That publication ranked 16 cities by estimated
real GDP but it
was silent on the question of its forecast for real GDP by
province. Could the government have invented quotes for
its propaganda?
On December
8th the Ministry of Finance released the updated forecasts
of the 13 member Economic Forecast Council, which from which
the Budget Transparency and Accountability Act requires government
to seek advice. In early December the average forecast for
2004 was 2.9 per cent real GDP growth with a range amongst
the 13 panelists from 2.5 per cent to 3.3 per cent. Tim O'Neil
of the Bank of Montreal then
estimated 2.7 percent growth for 2004; Don Drummond of
the TD Bank Financial Group estimated 3.0 per cent. The Ministry
of Finance estimates that provincial revenues fluctuate between
$200 million and $300 million for every 1.0% change in GDP
growth, so what might appear to be picky differences in the
estimates translates into very big bucks. The growth estimates
also relate to the number one goal for the Campbell government
- no, not balancing the budget, but "renewing our economy
is unquestionably this government's top priority" (Strategic
Plan 2003). So far they aren't doing very well.
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