New Brunswick economic growth in 2024 predicted to be weaker than Maritime neighbours — again
Economies of Prince Edward Island and Nova Scotia have outperformed N.B. almost every year since 2007
The New Brunswick government has been touting a "much healthier economy" in the province in recent years but economists with four major Canadian banks are projecting New Brunswick will finish last among the three Maritime provinces in economic growth in 2024 — for what their estimates show will be a fourth straight year.
Numbers released last fall by Statistics Canada show New Brunswick finished behind both Nova Scotia and Prince Edward Island in growth in 2021 and 2022.
Figures for last year will not be finalized for a number of months but the Bank of Montreal, Scotiabank, TD and the National Bank all estimate New Brunswick finished third among the three Maritime provinces again in 2023 and forecast the same third place result for 2024.
"The external backdrop has taken some wind out of N.B.'s sails and we expect exports to remain relatively soft," TD wrote in its March 20 analysis of New Brunswick's 2024 prospects.
"Manufacturing sales, which are lagging other provinces, are tracking for a fifth consecutive quarterly decline."
An
economics report issued by the TD Bank on March 20 predicts N.B.'s
economy will grow more slowly than its Maritime neighbours for the
fourth straight year. (Sam Nar/CBC)
It is not the picture painted by New Brunswick Finance Minister Ernie Steeves last week during a budget speech that cited his government's "economic success" on a number of fronts, under the theme "Stronger than Ever."
In an obvious comparison to the previous New Brunswick government of Brian Gallant, Steeves claimed the province's economy has improved considerably since 2018.
"A short time ago, we had weak economic and population growth and unsustainable public finances," said Steeves. "Today, we have a much healthier economy with significant growth potential, record population growth and sustainable public finances."
Steeves accurately noted New Brunswick government debt levels are significantly lower than they were in 2018, the province's population has grown substantially, and there are more jobs to serve that population. But whether that all adds all up to a much healthier economy is less certain.
In his speech, Steeves said his department is projecting "real GDP [Gross Domestic Product] growth of 0.7 per cent" in 2024, after what his department estimates was 1.1 per cent growth in 2023.
The
Liberal government of former premier Brian Gallant was routinely
ridiculed by opponents for New Brunswick posting weak economic growth
numbers on his watch but they stack up favourably against current growth
numbers. (Canadian Press)
By comparison, economic growth in the final two years of the Gallant government, which Steeves criticized as "weak," was higher at 2.4 and 1.4 per cent, with none of the four years under Gallant posting a growth rate as low as his 2024 prediction of 0.7 per cent.
Rather than breaking with the past, Steeves's projections continue a long pattern of mediocre economic growth for New Brunswick that now stretches back for nearly a generation.
According to Statistics Canada, economic growth in New Brunswick has not matched or exceeded growth in Prince Edward Island since Shawn Graham was premier in 2007. That is 15 straight years of being outperformed, as of 2022, and 17 straight years if projections made by the four banks for 2023 and 2024 hold true.
Economic growth in Nova Scotia was also greater than in New Brunswick in all but three of those years.
P.E.I.
may be famous for potatoes and tourism but its entire economy has been
rolling for nearly a generation. It has posted higher growth numbers
than New Brunswick every year since 2007. (Brian McInnis)
There are several ways to measure that long stretch of weak growth, including New Brunswick's GDP per capita, which was 110 per cent of P.E.I.'s GDP per capita in 2007. It is now lower after being surpassed by the island province for the first time in 2022.
Fred Bergman, a senior policy analyst with the Atlantic Economic Council, said there is no disputing economic growth in Nova Scotia and Prince Edward Island has been outpacing growth in New Brunswick in recent years but understanding the reasons for it would take a lot of analysis.
"You've really got to dive into the data to get at this, and it's a very complex thing," said Bergman.
"A lot of it is due to differences obviously in economic structure between each of the provinces, but the real devil is in the details. You've got to figure out what's driving the growth and what's keeping it slower."
Leaving estimates for 2023 and 2024 aside, Statistics Canada figures show "real" economic growth, not including price inflation, was 36.1 per cent in P.E.I. between 2007 and 2022. That compares to 19.7 per cent in Nova Scotia and 10.4 per cent in New Brunswick.
Included in those numbers are the four Brian Gallant years, 2015 to 2018, when growth in New Brunswick totalled 5.6 per cent. That was well behind P.E.I., at 10.2 per cent, and just short of growth in Nova Scotia, at 6.1 per cent, in those same years.
During the first four years of Premier Blaine Higgs's government, ending in 2022, figures from Statistics Canada show growth in New Brunswick was 4.3 per cent. That was also third best in the Maritimes, well behind growth in P.E.I. of 13.4 per cent and just better than half the growth rate achieved in Nova Scotia of 7.9 per cent.
ABOUT THE AUTHOR
My qeustion is what will the shares in their banks be worth a year from now?
Since the Trudeau government took office in 2015, our (inflation-adjusted) GDP per capita has grown by a meagre 1.9%. The US growth rate during the same time has been 8 times higher.
And, to top it off, Canada is projected to record, for the period 2020 to 2030, the slowest GDP/capita growth of the 38 developed countries in the OECD. Imagine, Canada coming in last out of 38 developed countries.
Where NB stands relevant to NS or PEI is pretty much irrelevant compared to the much bigger picture of what has happened, and continues to happen, with economic growth in our country. Our total economy is stalling.
P.S. I found it
Good!!
Trudeau says conservative premiers are lying about carbon pricing
Most premiers pushing federal government to halt scheduled carbon tax increase
Prime Minister Justin Trudeau accused conservative politicians across Canada, including premiers, of lying to Canadians about the carbon price.
Trudeau's government is buckling as attacks mount against carbon pricing, and voters increasingly side with politicians who say the policy is making their lives less affordable.
Most premiers and the federal Conservatives want the Liberals to cancel Monday's scheduled increase of the carbon price by $15 per tonne, adding 3.3 cents to a litre of gasoline and 2.9 cents to a cubic metre of natural gas.
The carbon rebates sent to households every three months are also being adjusted in parallel to the carbon price itself.
Political leaders who criticize the policy are failing to acknowledge and inform Canadians about those rebates, which are meant to offset costs to consumers, Trudeau said. Households that lower their fuel use save money, but their rebate amounts are unaffected.
"Conservative premiers across this country are misleading Canadians, are not telling the truth," he said.
"Eight out of 10 families across the country in federal backstop jurisdictions make more money with the Canada Carbon Rebate than it costs with the price on pollution."
The "backstop" is the federal pricing system, which applies in every jurisdiction that does not have an equivalent pricing system of its own. Currently, British Columbia, Quebec and Northwest Territories do that, while all other provinces and territories use the federal consumer levy.
Trudeau also accused Conservative Leader Pierre Poilievre of blocking legislation that would double the rebate top-up for rural Canadians.
His comments at a press conference in Vancouver came the day after he wrote to critical premiers suggesting they haven't come up with a viable alternative — but is all ears if they do.
They also came as Saskatchewan Premier Scott Moe was pressing his case against the carbon price to a House of Commons committee, the first of three premiers who will do so this week.
Moe said he believes in climate change and that emissions need to go down. But he said pricing pollution is not the way to do it.
"The goal is not for the big polluters to pay, the goal is for them to emit less," he said, bristling a little during an exchange with New Democrat MP Alexandre Boulerice.
"How is it we shouldn't make big polluters pay?" Boulerice demanded, accusing Moe of believing that "giant vacuum cleaners" will suck emissions out of the sky to solve climate change.
Moe said Saskatchewan's industry and farmers have lowered their emissions and are displacing products overseas that have a higher carbon footprint.
"We are not climate laggards," Moe said.
He insisted the carbon price makes it harder for families and businesses to lower their emissions.
Sask. premier challenged by MPs
The antagonistic nature of the debate was on full display at the committee, which spent almost as much time arguing about whether Moe should have been there at all as it did hearing what he had to say.
Liberal, NDP and Bloc Québécois MPs accused the Conservatives, who chair the committee, of circumventing other members and inviting Moe to speak without any consultation.
MPs from the three parties, which all endorse carbon pricing, pushed Moe to explain what he would do to cut emissions.
Conservative chair Kelly McCauley said he invited Moe and other premiers because they had asked to speak to the finance committee, which has refused them.
Alberta Premier Danielle Smith and New Brunswick Premier Blaine Higgs are both scheduled to appear at the committee Thursday.
Smith said Wednesday her province has a plan to be carbon-neutral by 2050 by cutting major industrial emissions. She pointed to a Canadian Climate Institute report last week that said the carbon price on heavy industry is doing more to cut emissions than the consumer levy.
The consumer levy is still expected to cut between 19 million and 22 million tonnes of emissions annually by 2030, which could amount to about 10 per cent of what Canada aims to cut over that same timeline.
Smith herself is under fire in Alberta for hiking the provincial gas tax five cents a litre on April 1, more than the 3.3 cents being added by the carbon price and without any accompanying rebate.
Smith defended the move, which reinstates a tax that had previously been slashed, as necessary to pay for roads.
A similar attack was launched against Higgs in New Brunswick after the province's utilities board approved nearly a 13 per cent hike to electricity bills as of April 1.
N.B. Liberal Leader Susan Holt called for an emergency debate in the provincial legislature about the hike.
"If Premier Higgs was focused on New Brunswickers instead of obsessing with Ottawa, he would be doing his part to make life more affordable for you," Holt said in a social media post.
Ontario Liberal MP Francis Drouin also challenged Moe on why, if he's so concerned about the cost of living, he hasn't cut provincial taxes.
Saskatchewan already exempts natural gas used for heat from provincial sales taxes.
Trudeau challenges premiers opposed to carbon tax hike to suggest alternatives to federal levy
Several premiers have been calling on Ottawa to halt a planned increase to the federal carbon tax
Prime Minister Justin Trudeau is calling on premiers opposed to increasing the carbon tax to propose credible alternatives to the federal measure.
On Tuesday, Trudeau wrote to seven premiers who have been calling on Ottawa to pause an imminent hike to the federal levy or scrap the program altogether.
In his letter, the prime minister suggested that the governments of New Brunswick, Prince Edward Island, Saskatchewan, Alberta, Ontario, Nova Scotia and Newfoundland and Labrador haven't put forward suitable replacements to the federal backstop.
"When we last engaged with provinces and territories on this in 2022, all of your governments either did not propose alternative systems or … proposed systems that did not meet the minimum standard for emissions reductions," the letter reads.
The federal policy — which includes both a tax on fossil fuels and rebates paid directly to households — was introduced by the Liberal government in 2019. It's designed as a financial incentive to encourage people and businesses to cut their consumption of fossil fuels and transition to greener forms of energy.
Canadians living in the eight provinces where the federal carbon tax applies receive quarterly rebate payments which vary depending on the province and the size of household.
In his letter, Trudeau pointed out that Quebec, British Columbia and the Northwest Territories all have their own systems and are not subject to the federal tax.
"We continue to remain open to proposals for credible systems that price pollution that reflect the unique realities of your regions and meet the national benchmark," he wrote.
Conservative Leader Pierre Poilievre has has made the federal carbon tax a key point of attack against the governing Liberals. (Travis Golby/CBC)
The carbon price is scheduled to increase from $65 to $80 per tonne on Monday.
Four premiers — including Danielle Smith of Alberta, Saskatchewan's Scott Moe, Nova Scotia's Tim Houston and Blaine Higgs from New Brunswick — have written to the House of Commons finance committee asking to appear and speak about the carbon tax. Moe is set to appear before the government operations committee on Wednesday.
Federal Conservative Leader Pierre Poilievre has vowed to scrap the tax if he forms a government after the next election.
The Conservatives released a statement Tuesday supporting the idea of premiers appearing at committee.
"Conservatives believe that Parliament has a duty to listen to Canadians on matters of national importance," the statement said.
Poilievre has also been ramping up pressure on the government to stop what he calls the government's "April Fools' tax hike."
The Conservatives put forward a non-confidence motion on the carbon tax in the House last week that, if passed, would have toppled the Liberal government and forced an election. The Liberals survived the vote with support from Bloc Québécois and NDP.
Economists defend policy
Trudeau's letter to the premiers comes after more than 100 economists signed an open letter defending the carbon tax policy.
"There is plenty of discussion about carbon pricing in Canada today. Healthy public debate is good, but it should be based on sound evidence and facts," the letter reads.
The economists argue that a carbon tax is the cheapest way to lower greenhouse gas emissions.
"Unfortunately, the most vocal opponents of carbon pricing are not offering alternative policies to reduce emissions and meet our climate goals. And they certainly aren't offering any alternatives that would reduce emissions at the same low cost as carbon pricing," the letter says.
Clarifications
- This story has been updated to clarify that Saskatchewan Premier Scott Moe is appearing before the government operations committee on Wednesday, not the finance committee.Mar 27, 2024 9:41 AM ET
ABOUT THE AUTHOR
Brian Macdonald
Biography
EN
Brian Macdonald is a bilingual senior political and corporate affairs executive with a government, defence, and security background. Throughout Brian's career, he has served in various leadership roles in the private and public sectors.
Prior to joining Samuel Associates as a Senior Political Associate, Brian was an executive at Scotiabank in Toronto, where he served as the Director of Crisis Management. As part of a small elite team working with Scotiabank's Operations, IT and Security divisions, he was responsible for enhancing the bank's daily operational readiness and, when required, for acting quickly and efficiently in a crisis.
Before his career in the financial sector, Brian served in an elected capacity for two terms as a Member of the Legislative Assembly of New Brunswick (MLA), representing Fredericton-Silverwood in 2010 and Fredericton West-Hanwell in 2014. During his time in elected office, he was appointed as New Brunswick's first Legislative Secretary for Military Affairs. In this political leadership position, Brian raised awareness about the vital role that the Canadian Armed Forces plays in the province, throughout Canada and internationally. He championed an open dialogue to support veterans transitioning from the military to the private sector. While in opposition, he served as Health Critic. Brian advocated strongly for increased ambulance service throughout New Brunswick and better support for those suffering from mental health illness and related issues.
Previous to holding elected office, Brian was a Senior Political Advisor to the Minister of National Defence in Ottawa. In this role, he was responsible for providing strategic advice and political recommendations to the Minister concerning two strategic initiatives: The Canada First Defence Strategy and the National Shipbuilding Procurement Strategy.
Brian served with the Royal Canadian Regiment in Petawawa, Ontario. He commanded troops overseas, where he completed two tours in Bosnia and a special security assignment in support of a G8 Summit. He then transferred to the British Army to work as a consultant on the Iraqi Currency Exchange Project and was deployed to Afghanistan on counter-narcotics operations.
Brian received his B.A. Honours from the Royal Military College of Canada. During his undergraduate studies, he also participated in an exchange program to the Australian Defence Force Academy, where he lived and studied in Canberra, Australia. In pursuit of higher education, Brian is a Mackenzie King Travelling Scholar, who received his Master's degree from the London School of Economics.
Currently, Brian resides in New Brunswick and serves on the Veterans Transition Network Board, where he continues to champion the need for better support services to help veterans receive mental health services nationwide. In his capacity to develop next-generation private and public sector leaders, he works as an advisor providing experiential learning and leadership training to two business universities: The Smith School of Business at Queen's University and the Ivey School of Business at the University of Western Ontario.
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