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November 17, 2015
For immediate release

Updates show state of economy, second-quarter fiscal position

Finance

Sectors of the province’s economy continue to grow while the deficit in the second quarter of fiscal year 2015-16 is slightly higher than budgeted, Finance Minister Allen Roach says.

“The diversity of Prince Edward Island’s economy – and our efforts to strengthen new and existing businesses – have helped it remain resilient in the face of more difficult economic news nationally and internationally,” Minister Roach said. “While our second-quarter fiscal position shows a higher-than-projected deficit, we continue to work toward our goal of a balanced budget in 2016-17.”

Minister Roach tabled the province’s 2015 Fall Economic Update and its 2015-16 Second-Quarter Fiscal Update in the House on November 17. The economic update provides these and other highlights:

• provincial gross-domestic product (GDP) grew by 1.5 per cent in 2014 and similar growth is expected in 2015 and 2016 – it has grown on par with Canada’s and has outpaced the other Maritime provinces over the past 10 years;

• seasonally adjusted manufacturing shipments grew faster than in any other province at 5.9 per cent through August;

• the value of international exports is up 18.7 per cent through September, also the fastest growth in the country;

• new housing construction is up 13.9 per cent;

• lobster landings are up 8.1 per cent and the catch value is up 28 per cent compared to last year; and

• the province’s population continues to have the fastest growth in the Atlantic region and now stands at 146,447.

The 2015-16 Second-Quarter Fiscal Update forecasts a deficit of $32.9 million, which is $13 million higher than the budgeted deficit of $19.9 million. The increase is mainly a result of:

• additional investments in education ($1.6 million);

• additional funding required for employee benefits ($5.9 million); and

• increased expenditures for acute-care hospitals and in-province medical services ($3.9 million).

“Although we recognize that the province’s deficit has edged up slightly after consecutive periods of decline, it’s important to note that this update is only a snapshot in time – in 2014-15 our fiscal picture improved significantly as the year progressed,” Minister Roach said. “We are working together with our departments to ensure that we meet our budgetary objectives and get back on track to balance our budget in 2016-17.”

The 2015 Fall Economic Update and the 2015-16 Second-Quarter Fiscal Update are available at www.gov.pe.ca/finance (click on Economic and Fiscal Update).

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Media Contact: Brad Chatfield
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