Hard part behind for territory economies: report suggests

The three northern territories will see modest but consistent economic growth starting in a year or two, says the Conference Board of Canada.

“I think the difficult part is behind them right now,” MarieChristine Bernard, author of the board’s economic outlook for Yukon, the Northwest Territories and Nunavut, said Wednesday.

All three territories are heavily dependent on mining and have been hammered by low commodity prices, said Bernard.

The N.W.T. economy has been stuck in neutral for 2016, but its GDP is forecast to grow more than 15 per cent next year as the De Beers diamond mine comes into full production.

Further east, the Nunavut economy is expected to grow by nearly five per cent in 2017 as new gold mines open. Government spending on airports, schools and municipal facilities will also buoy the numbers.

Yukon, where the last operating mine is scheduled to close by the middle of next year, has suffered the worst, Bernard said. The territory’s GDP is forecast to fall by more than seven per cent next year and another three per cent in 2018.

“Some of these [Yukon] projects were almost shovel-ready before commodity prices started to decline more seriously. The main hurdle is prices and obtaining financing.

“In the next decade you should see some projects come back.”

Future prospects are better in the N.W.T. as expansions to existing mines such as the Ekati diamond mine get built.

Nunavut has three mines in the development stage that should start producing over the next few years.

Solid, sustainable growth for all three territories should come by 2020 after commodity prices stabilize, Bernard said.

Overall, the board expects the three territories will average three per cent growth every year between 2020 and 2030. Mining will remain the source of almost all of that.