Deputy Premier and Minister of Finance Siobhan Coady presented Newfoundland and Labrador’s fiscal update, highlighting notable economic growth in 2024:
- Economic Growth: Real GDP is expected to grow by 3.3%, supported by strong consumer spending. Employment is projected to increase by 2.8%, with the unemployment rate anticipated at 10.5%—close to a historical low.
- Retail and Housing: Retail sales are forecasted to rise by 5.1%, higher than the 2.8% projected at the budget. Housing starts have surged, with home sales above last year’s figures through September.
- Population Growth: The population has increased for 14 consecutive quarters, adding 6,340 residents from July 2023 to July 2024.
- Inflation: Inflation has dropped to 2.1% (January-September), below the national rate of 2.6%. September saw inflation fall to 0.7%, the lowest since December 2020.
Key industries—including mining, oil and gas, fisheries, wind-hydrogen, technology, and film—are expected to drive ongoing economic growth.
Fiscal Highlights:
- Deficit: The provincial deficit is projected at $218 million on a $10.4 billion budget, slightly above the Budget 2024 estimate of $152 million.
- Revenues: A $164 million decrease in revenues is attributed to lower oil royalties, impacted by decreased production and a lower oil price, partly offset by a favorable exchange rate.
- Expenses: Expenses have declined by $98 million, primarily due to the timing of program expenses and gains in pension and post-employment benefit liabilities.
- Oil Price and Exchange Rate: The forecasted average oil price for 2024-25 has been adjusted to US$81 (from US$82), and the exchange rate to 73.2 cents CAD/USD (down from 74.7 cents).
- Future Fund: Contributions to the Newfoundland and Labrador Future Fund are expected to total $354 million by the end of 2024-25.
Minister Coady emphasized that the province is on track fiscally and exceeding economic expectations, attributing success to local efforts and strategic fiscal planning aimed at long-term stability.
