Comment 72736

By Nox (anonymous) | Posted January 05, 2012 at 08:02:05 in reply to Comment 72735

"GDP growth in Ontario is expected to remain sub-par at 1.7% in 2012. Manufacturing will likely continue to claw its way back following the severe downturn in 2008-09, largely on the back of expanding auto production. Supported by significant pent up demand, U.S. auto sales are expected to rise by 5% in 2012 and nearly 10% in 2013. Other areas of Ontario manufacturing will likely face a more challenging demand environment, however, in light of prospects for lacklustre Canadian and U.S. domestic spending. Ontario’s real estate market will also exert a drag on the expansion over the next few years, especially within the recently-booming Toronto condo market. In addition to the growing pipeline of supply, the knock-on effects of financial-market volatility to buyer confidence will likely result in a cooling down in condominium sales in the region in 2012 and 2013.
One important factor in the Ontario outlook for 2012 will be provincial public finances. At 2.5% of GDP, Ontario is by far the province with the most challenging deficit situation.(New Brunswick comes a distant second at 1.5%.) The Province has stated its goal to eliminate the budget deficit by fiscal 2017-18. It has established a commission headed by economist Don Drummond to recommend ways to restructure public services and find efficiencies. This could become a very significant expenditure-paring exercise for the government, with potentially more impact in 2013 than in 2012."

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