The expectation for 2009 is that consumers will be more reluctant to spend, as economic uncertainty continues to constrain growth.
Increased government expenditures will contribute to economic activity over the forecast period.
The Hebron project continues to drive confidence for future growth in the Newfoundland and Labrador economy. However, the project’s contributions in 2009 will be offset by a slowdown in mining and other resource based activity, including the fishery. Declines in offshore oil production will continue to dampen growth in 2009-2010. Although, the eventual increase in royalties received from Hibernia, as well as additional infrastructure spending by the province will offset some of the expected declines in private sector spending.
Although consumer spending in Prince Edward Island remained strong in 2008, the outlook for spending is expected to slow in 2009. As well, the prospects for weaker demand in other key sectors, including manufacturing and tourism, will result in weaker economic growth in 2009.
Furthermore, market conditions for the agriculture sector will continue to be challenging as a result of increased global competition and decreased global demand.
Achieving positive economic growth in 2009 will be a challenge for the Nova Scotia economy, as many industries and companies struggle to adjust to the new economic reality for the global economy. The outlook will be supported by the Deep Panuke project from EnCana, which will add to growth in 2009 and 2010, as the company continues to believe in the long-term future growth potential from this project.
Economic weakness will persist in New Brunswick, as a result of soft commodity prices combined with a growing sense of global economic uncertainty. Reduced nonresidential construction activity in New Brunswick is expected in 2009. Several current projects, including the LNG terminal project, the refurbishment of the Point Lepreau generating station in the Saint John area, and the expansion of the Potash Corp. facility in Sussex will slow as peak levels of activity have already been reached.

Housing Forecast

Multiple starts are expected to decline in 2009, but row starts will remain popular in some urban centres, says Guiseppe Strazzeri, across Atlantic Canada, as the current price of housing will continue to force some consumers to shift away from more costly single-detached units. Higher prices will also continue to ease demand for single starts, as well as MLS® sales in 2009.