The Yukon economy will be strong again, if you ask BMO Financial Group’s chief economist.
Douglas Porter delivered the keynote address at the Whitehorse Chamber of Commerce awards dinner this week. He has been predicting the global economic future for more than 25 years.
And for the Yukon, that future is cloudy with a chance of sunshine.
Porter predicted no growth in the Yukon economy for 2013, given the slow down in mining and exploration.
“The Yukon economy compared to the rest of Canada is, no surprise here, incredibly levered to the mining sector.”
But the current slowdown should be taken in the context of the “tremendous period of growth” that preceded it, he said.
This year will be the first since 2005 where Yukon’s growth has not outpaced that of the country as a whole.
And by 2015, those tables should turn again in Yukon’s favour, Porter predicted.
Why the optimism?
While many commodities have seen sharp price drops this year, the outlook in the medium term is still looking good, said Porter.
While commodity prices have fallen, they are still doing well in a historical perspective, and many are at or above their five-year average, he said.
Growth in China’s industrial production is the prime indicator for commodity prices, said Porter. And while that growth has slowed in recent years, is should stabilize soon, he said.
And the U.S. economy is finally poised to make a real recovery, he said. Europe, too, could see some progress.