Nov. 27, 2020

ALBERTA ECONOMIC UPDATE – NOVEMBER 24, 2020

  • Retail spending and housing have rebounded more strongly from the pandemic than anticipated.
  • Agriculture is benefitting from strong crop conditions overall; lumber is experiencing higher prices; natural gas producers are supported by higher prices.
  • October employment was down 4.4% from pre-COVID peak with an unemployment rate of 10.7%.
  • Real (after inflation) GDP is expected to decline 8.1% (largest contraction in history) in 2020 then rebound to 4.4% growth in 2021.
  • Budget deficit of $21.3 billion is now projected for 2020-2021 (6.9% of GDP, largest among provinces).
    • Revenue is expected to be $8.6 billion below budget down (10% Y/Y)
    • Expenses are running at $5.4 billion (9.5% above budget)
  • Total debt is expected to end 2020-2021 at $97.4 billion ($22,000 per Albertan).

COVID-19 WHAT’S NEW?

  • Canada’s is expected to receive at least 194 million vaccine doses, with contractual options for 220 million more.
    • Canada does not produce any vaccines; we count on supplies from external manufacturers
  • Sobeys is reinstating bonus pay for workers in lockdown areas.
  • Abionic, a Swiss firm has introduced a blood test that can pinpoint COVID-19 patients at a risk of a severe form of the disease. The test can be performed without medical training and gives results in 5 minutes.
  • AstraZeneca is going to rerun their phase III clinical trials.
  • Rome’s airport to offer COVID-19 tested flights to the US with Delta and Alitalia.
  • Australia’s COVID-19 hotspot, Victoria State, has recorded 28 days without an infection after a strict 100-day lockdown left people largely confined to their homes.

ENERGY AND ENVIRONMENT

  • Prime Minister Trudeau says that completing the Trans Mountain pipeline expansion is more vital than ever, saying Canada’s oil sector cannot be held ‘prisoner’ with the US as its only customer.
  • International Energy Agency says China’s oil refining capacity is expected to overtake the US next year.
  • Roughly 40% of the world’s people live in farming areas facing large water shortages.
    • Approximately 3.2 billion people live in areas with ‘high to very high’ water shortages according to the UN’s Food and Agricultural Organization
    • Of that, 1.2 billion (1/6 of global population) are in areas with severely constrained water supplies

TIDBITS

  • TFSA limit for 2021 is $6,000.
  • More than 42.4% (2017-18) of American adults are clinically obese vs 30.5% in 1999-2000. To be in the healthy range, Medical News Today says a 6 foot tall person should weigh between 140 and 177 lbs and a 5 foot 6 inch person should weigh 118-148 lbs.
  • Nearly 14,000,000 Americans’ unemployment benefits under the pandemic program will expire December 26th.