For the first time in at least 20 years, Quebec's economy will experience a contraction in 2023. The national capital also ranks last among large Canadian cities for its ability to create wealth.
Quebec City experienced a significant slowdown in its gross domestic product (GDP) last year, with a drop in output estimated at 0.4%.
ends Conference Board Canada in a new study.
According to the firm, this episode of negative growth is unique in the country's big urban centers.
Quebec City lags behind 13 major Canadian cities
Underlines chief economist Pedro Antunes Conference Board From Canada.
In 2022, the Quebec region also ranks at the bottom of the country in wealth creation, but the economy continues to grow.
The national capital has not experienced an episode of economic decline for over 20 years, the think tank said.
Even in 2009, in the wake of the global financial crisis and the fall in stock markets, Quebec's gross domestic product recorded a modest increase of 0.74%.
A the tiger
declawed?
The Conference Board Notices a Declining business confidence
In the capital, it was also noted by the Quebec International Survey earlier in the year.
The scenario is not conducive to private investment, but residential construction starts in the region are down 40% in 2023.
The current gloom seems a stark contrast to the optimism of the decades before the pandemic in Quebec, during which the capital took shape. Economic tiger
According to economists Pierre Fortin and Mario Poles.
The Conference Board Canada predicts that the region continues to suffer from labor shortages, a situation that could worsen with the unemployment rate expected to stabilize at 3% between 2024 and 2028, down from an average of 4.1% recorded between 2015 and 2015. And 2019.
It takes investments and it takes people [à Québec].
However, the capital lags significantly behind other Canadian cities in terms of population growth due to low immigration and an aging population.
Over the past year, Quebec has not welcomed enough new residents to offset the decline in housing consumption due to inflation and rising interest rates.
Population growth approaches 3% in many cities across Canada, but in Quebec we've reached half that.
Pedro Antunes recalls.
Effect of tram failure
The Legault government's decision to shelve the tram project, valued at more than $8 billion by the Marchand administration, is expected to have ramifications for Quebec's ability to attract investment in the coming years. Conference Board From Canada.
Mayor Bruno Marchand was disappointed at the end of his meeting with Prime Minister Francois Legault last November, lasting just over an hour.
Photo: The Canadian Press / Jacques Boissinot
This affects investment intentions and investor confidence
Pedro Antunes warned.
Recently, Quebec's Urban Development Institute (IDU) estimated the value of pending residential projects along the tramway at nearly $2 billion.
Pedro Antunes believes that experience in the country and around the world shows the rapid impact of major infrastructure projects on the local economy. In the case of Quebec, the tramway has the potential to become the most important project in the history of the national capital.
Infrastructure projects have knock-on effects on long-term private investment
Mentions Pedro Antunes.
The Conference Board Canada forecasts weak growth of half a percentage point for Quebec GDP in 2024.
A year-end cut in interest rates will further boost the economy in 2025.
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