British Columbia will enjoy a gross domestic product growth of 3.1 per cent for 2007 and 3.2 per cent for 2008, according to a new report from the Canada West Foundation.
B.C.’s economic strength is playing an important role in the shift of economic dominance from central Canada to the West, said Brett Gartner, author of
Let the Good Times Roll: British Columbia Economic Profile and Forecast
Looking forward, British Columbians can expect continuing prosperity. High levels of construction activity and business investment, ongoing strength in worldwide demand for base metals and other commodities, growth in China and India, and an educated and skilled workforce will all contribute to sustained economic growth.
The provincial government’s finances are in good shape. Personal income tax cuts announced in the 2007 budget mean that B.C. has the lowest provincial income tax rates in Canada for those earning up to $108,000.
Public policy developments such as the implementation of the B.C.-Alberta Trade, Investment and Labour Mobility Agreement (TILMA) will also contribute to a positive future. The agreement will give businesses and workers in both provinces greater access to a larger range of opportunities, creating Canada’s second-largest economic region (after Ontario).
The TILMA has special provisions for transportation, energy, labour mobility, business and corporate registration and procurement. By reducing all barriers to trade and labour mobility across the region, there is good potential for increased business opportunities and efficiency gains in BC.
On the downside, the slowdown of the U.S. housing market will dampen prospects for the economically important forestry industry. Events in the U.S. - combined with rising energy and wage costs, and a strong Canadian dollar - will prove to be very challenging for the forestry sector. In the longer term, the negative effect of the mountain pine beetle will add to the misery felt by the industry.
The tourism sector faces another round of challenges with high gasoline prices, the soaring loonie and tough border restrictions for U.S. visitors.