ATB Financial’s latest Alberta Economic Outlook report says the provincial economy is still facing a number of challenges.

The Outlook released on Thursday forecasts real gross domestic product growth of only 0.7 per cent this year and 1.6 per cent in 2020.

“Despite all the headwinds hampering Alberta’s economic progress, it looks like we will avoid slipping back into recession. With that said, we’ve cut our growth forecast in half from where it was in March,” said ATB’s chief economist Todd Hirsch, in a statement. “With real GDP growth of just 0.7 per cent, it is going to feel slow in our province.”

The outlook’s key findings are:

• job growth will be slow if not negative this year;
• retail sales growth is expected to be weak;
• global growth appears to be slowing;
• prices for Alberta oil have improved, however, capital investment and drilling rates are down;
• oil and gas pipeline challenges remain unresolved;
• manufacturing sales started the year on a stronger note and are expected to perform relatively well going forward across most sub-sectors;
• Alberta’s population will continue to grow.

Uncertainty in the global economy, including the China-U.S. trade war, may also impact the overall Alberta economy this year due to a possible risk of a global slowdown economically, the report said

“The global oversupply of crude oil caused the price to collapse in late 2014 and sent Alberta spiralling down into the worst recession in 30 years. At the moment, domestic challenges to new pipeline development are hindering Alberta’s economy,” said Hirsch. “Hopefully, a major global slowdown will be avoided and not add to the barriers we face.”

– Mario Toneguzzi

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