The Conference Board of Canada is forecasting a better economic picture for Alberta, but the Red Deer & District Chamber of Commerce is taking a wait and see approach.
According to the board’s new outlook, Alberta should see economic growth of 2.4 and 3.1 per cent in 2020 and 2021 respectively, based mostly on the improved outlook for the energy sector.
“We’re not getting back to the mid-2000 boom period, but certainly more steady, modest growth over the next couple of years,” said Alicia Macdonald, associate director of economic forecasting with the board, which is a not-for-profit think-tank.
The Canadian economy is expected to grow 1.8 per cent in 2020, up from 1.6 per cent this year, also due to energy investment and consumer spending.
Reg Warkentin, policy and advocacy manager at the Red Deer & District Chamber of Commerce, said Alberta’s positive forecast seems to conflict with less oil and gas drilling expected by the Petroleum Services Association of Canada next year.
He said so far, it doesn’t seem like it’s getting better for many area businesses.
“They’re still having some pretty intense struggles to keep their lights on and doors open,” Warkentin said.
“Certainly, it’s a welcome sign that the economic climate is looking to improve in 2020. We really do hope it does translate into some economic activity in central Alberta, and not just other parts of the province.”
He said local companies moving assets down into the United States, or increasing exports, are doing better than others.
Michael Clark, CEO with Canalta Controls Group, said the confidence in the oil and gas industry could turn into a self-fulfilling prophecy, but hurdles can easily pop up.
“I don’t see a lot of success in simply hoping for business as usual, the way it was, where it was a focus on production and export,” said Clark, who manufactures natural gas meters for industry.
But he said Alberta is a great place for companies to access cheap energy resources for value-added operations, like producing power onto the grid system for other jurisdictions.
“If you’re a buyer of natural gas, it’s one of the best places to set up business,” Clark said.
Warkentin said provincial initiatives such as cutting corporate taxes, the elimination of the carbon tax and red tape reduction will hopefully encourage investors and business owners to feel more confident to spend again.