In yesterday’s mid-term budget report, Finance Minister Donna Harpauer said a return to normal crop production and rising oil prices paired with strong oilfield investment is expected to support stronger economic growth in 2018.
Daniel Fields, an economist with the Conference Board of Canada said his organization has forecasted increases in oil prices but those predictions aren’t always stable.
“It’s always a tricky business forecasting oil, you never quite know,” Fields said. “The second you say [oil] is going to increase it goes the other way, but a pretty stable increase [in prices] is the general consensus and that’s in our forecast right now.”
Fields said it isn’t a good bet to rely strictly on oil prices but Saskatchewan has a diverse economy which should grow in many areas into 2018.
Overall, Fields said he sees the government's budgeting plans as achievable.
“We have the province improving over the next few years,” Fields said. “Investments [are] coming back and private sector growth should be coming back as well. We see revenues growing as well as the oil prices rising… if we see revenues growing we see the plan going forward to still be achievable.”
While the province had to dip into the contingency fund, Fields said it’s typical of governments to dip into those monies in times when growth is weaker than expected. He said the use of the contingency fund is acting as a counter weight to the savings of $96.6 million from crop insurance claims.
Fields said the numbers provided in the mid-term report are not adjusted to include pensions, so more changes could be on the horizon.
On Twitter: @BryanEneas
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