EDMONTON — Alberta’s first-quarter fiscal update says the double blow of collapsing oil prices and the COVID-19 crisis have pushed the province into a historic deficit of $24.2 billion.
The red ink Finance Minister Travis Toews is predicting for 2020-21 is more than triple what the United Conservative government projected in its February budget.
The value of everything Albertans produce is forecast to drop by nearly nine per cent.
The unemployment rate, now about 12 per cent, is expected to remain at near double-digit levels well into next year.
The government says the economy will start to bounce back next year, but it won’t be enough to make up for the ground lost in 2020.
The Conference Board of Canada said this week that Alberta will be the hardest hit province economically this year with an 11 per cent contraction in GDP.
Red Deer & District Chamber of Commerce CEO Rick More said the government’s numbers show how important it is for the province to proceed quickly and safely to Stage 3 of the plan to reopen the economy.
“Although it’s hard to maintain positive outlooks, we must steady the course and continue to support our service and retail industry as employees get back into the workforce,” said More.
“We cannot sustain deferrals on tax and mortgages, etc., and now is not the time to address debt repayment.
“Many of our members are running on fumes right now.”
More said there are signs the local economy is improving, with investment dollars being sunk into dormant commercial properties and better real estate numbers.