A reborn tourism industry, rapidly growing high-tech sector and expansion of the shipbuilding industry are expected to have the Victoria economy humming over the next few years — and helping to propel the province, says the Conference Board of Canada.
In a report released Wednesday, the Conference Board predicted the provincial economy will grow at an average of rate of 2.7 per cent over the next three years and Greater Victoria’s economy will play a significant role in that growth.
The board’s fiscal snapshot of B.C. — titled Back on Solid Ground — said the province is in good financial shape with growth expected to be 2.3 per cent this year and 2.9 per cent in 2015, driven by natural resources.
While forestry, which is seeing resurgent demand in the U.S. and China, is given a lot of credit for growth in the report, the board noted shipbuilding is about to get its due.
A lot is expected from shipbuilding in Victoria.
“We may see some metal cut on new ships in the fall of next year, which will bring jobs,” said Greater Victoria Chamber of Commerce chief executive Bruce Carter.
As many as 17 federal ships are to be built by Seaspan Shipyards in Vancouver and in Victoria, where the ships will receive finishing touches and go through sea trials.
In all, the industry will be working through more than $10 billion worth of contracts on the West Coast over the next five years.
Carter said that spurs investment at other shipyards like Point Hope, where there are plans to spend $60 million to expand with an eye on luring new business.
The shipbuilding resurgence in Victoria will be a complement to the high-tech sector, which is anticipating its $3 billion in annual revenues will increase significantly in the next two years.
The Victoria Advanced Technology Council is conducting an economic impact study of tech in Victoria.
“The early indications are the largest companies are definitely growing and seeing more than double-digit growth, and I am expecting [the study] to show the overall tech sector since our last study has grown significantly,” said Dan Gunn, executive director of VIATeC. “Saying 10 to 15 per cent growth is a safe number.”
Victoria’s tourism industry appears to have rebounded from lacklustre years and is starting to grow.
“I’ve moved from being cautiously optimistic to more optimistic. It’s pretty clear recovery is taking hold,” said Tourism Victoria chief executive Paul Nursey. “We’ve had two good years and we’re seeing an increase in momentum.”
That’s being driven by economic vitality and increased travel from key markets like the U.S. and Asia, Nursey said.
Through the first half of this year hotel revenues were up nine per cent over last year.
“That’s healthy, that’s significant growth, and heading into next year, we are optimistic,” he said.
While Canadian travellers are the bread-and-butter for tourism operators, what separates a “get-by year from a profitable year” is that U.S. market and the emerging market in the Asia-Pacific region, he said.
Closer to home, Carter is hoping the provincial government, which has a significant impact on the Victoria service economy, will start spending some of its budget surplus.
“I’m hopeful they will start to invest again in new government programs and initiatives, which is good for our service providers. There are a lot of people here who contract to government or who work for people who do,” he said. “That has been a tough market for the last four or five years.”
For its part, the Conference Board is pushing for the province to continue with a conservative spending regime, noting B.C. will need to keep a tight hold on spending if it wants to maintain a balanced budget.
