Ont., B.C. Lead Recovery This Year, Despite Introduction of HST: Conference Board

(Sunny Freeman — The Canadian Press)

Outstanding economic growth in Ontario and British Columbia – the provinces that will be hit with a controversial new tax regime this summer – will lead a nationwide recovery from last year’s downturn, the Conference Board of Canada has predicted in a report. Ontario and B.C. will see their economies grow by 3.8% over last year, despite the planned introduction of the harmonized sales tax on July 1 expected to raise consumer prices in both provinces, the private-sector economic forecaster said in its Provincial Outlook report published Monday.

“There are clear signs of economic recovery from coast to coast,” said Marie-Christine Bernard, associate director of provincial forecasting at the Conference Board. “The improved domestic economies of Ontario and B.C., along with increased demand from the United States, will support a strong rebound in both provinces.”

Overall, the Canadian economy’s gross domestic product is expected to be up 3.2% compared with last year, which began with one of the deepest recessions in decades following the financial crisis that erupted in the final months of 2008.

“Considering the epic collapse of the global economy in 2008 and 2009, Canada’s situation today is remarkably good,” the board said in its provincial outlook. The Conference Board expects growth to be even stronger in 2011, advancing to 3.3%, as increasing private capital investment and improving trade performance offset subsiding federal and provincial government spending. Read more here.