Southern B.C. Regions to Lead B.C. Economic Growth Into 2016, Says Central 1 Credit Union Forecast

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug. 19, 2015) - Low interest rates and a swooning loonie will underpin modest growth in British Columbia this year and major construction projects will drive expansion in 2016 and 2017, says a new regional economic forecast by Central 1 Credit Union.

"Regional economies in southern B.C. and Vancouver will benefit most from an anticipated rotation towards export-oriented goods and services sectors," says Bryan Yu, senior economist with Central 1, the trade association, liquidity manager and payments processor for B.C. credit unions. "I expect manufacturing, tourism, TV and film and agriculture will grow as the depreciated Canadian dollar and strengthening U.S. economy spur activity."

In contrast, disappointing global growth, particularly out of China, will put pressure on short- to medium-term growth in northern B.C. and Kootenay, Yu said.

"Forestry is a potential growth sector for northern markets as the U.S. housing market improves, but the long-term impact of the mountain pine beetle epidemic on timber supply will constrain production and growth," Yu said in his three-year forecast. "Northern B.C. is poised to grow at a faster rate in late-2016 onwards with the start of one liquefied natural gas terminal and pipeline, the Site C dam, and other major projects."

Highlights:

• B.C. will expand at a modest 2.7 per cent this year, before accelerating above three per cent.
• National growth will settle at a disappointing 1.2 per cent this before eking out a gain of two per cent next year.
• Low oil prices are generally positive for B.C. through lower costs for businesses and consumers
• Job losses by B.C. residents working in the oil sands are a greater risk for some regions, including the Thompson-Okanagan and Kootenay.

"The exceptionally low interest rate environment will lift housing demand across the province, but large urban areas with stronger population growth will enjoy the strongest demand and rising prices," Yu said.

Read the full report BC Regional Economic Outlooks.

About Central 1

With offices in Vancouver, Mississauga and Toronto, Central 1 - which holds approximately $13 billion in on balance sheet assets - provides wholesale financial products, trust services, investment banking services, along with digital and payment services that power innovation in retail financial services for more than 300 credit unions and institutional clients from coast to coast.

In addition, Central 1 is the primary liquidity manager, payments provider and trade association for our member/owner credit unions in B.C. and Ontario. Our members represent a consumer-oriented, full-service retail financial system that serves 3.3 million members and holds more than $99 billion in assets. For more information, visit www.central1.com.