By Katie Davis P remier, Christy Clark responds to British Columbia’s forecast of slower economic growth and a narrowing budget surplus over the next three years in. The reason for slower than expected growth being a softening of the housing market and U.S. trade disputes chopping at the roots of Canada’s fastest-growing province. In British Columbia’s recent budget delivery Premier, Christy Clark still promised to post another three years of surpluses. The surplus allowed Clark to announce some relief to taxpayers ahead of a May election, when Clark will seek a third term as premier of British Columbia. Economic analysts still expect British Columbia’s economy to outperform other provinces however, there are many risks including uncertainty in the U.S., slower growth in Asia, and a decelerating pro- vincial housing sector, according to the budget. “We can’t forget that there continues to be risks that could erode our strong economic position,” Finance Minister, Michael de Jong said in Victoria as he presented the budget. The budget pro- jected a $1.5 billion CND surplus in the year ending March 31, down from over 30 percent from the $2.2 billion CND estimated back in November of last year which will continue to fall under this fiscal plan to 2020 when they project a surplus of $223 million CND.
This surplus could disappear at a faster rate with threats of the U.S. imposing duties on the softwood lumber, which is the province’s biggest export commodity. B.C. exported $4.6 billion CND of softwood lumber to the U.S. in 2016.
“Political changes in our neighbors to the south have us cautious about making too many assumptions about the future,” de Jong said. B.C. has reduced its dependence on the U.S. as a market to 54 percent of its merchandise exports compared with 70 percent in 2001. “But make no mistake, the U.S. remains our largest single trading partner, and any interruption in that trade will impact us.”
As for the softening of the housing market, Clark’s government faces the challenge of growing affordability concerns, as housing startsplunging17percent, while trying tomanagea slowdown in theVancouvermarket, which isCanadian’s highest pricedmarket.
In what is being considered an Election Platform Budget, Clark announced cuts to healthcare premiums for consumers and plans to eliminate a retail sales tax on electricity for businesses. British Columbia will invest a record $13.7 billion CND on infrastructure over the next three years on roads, schools and healthcare facilities with transportation account- ing for a third of the overall spending.
As the province’s budget surpluses continue to narrow, Clark’s government looks to give the provincial economy a
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SPOTLIGHT ON BUSINESS MAGAZINE • MARCH 2017
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