Quebec: mining money magnet Quebec is strengthening its standing as the place miners want to be.
The province is expected to get about half of the private investment planned for Canada’s mining industry this year, with spending forecast to jump 62 per cent to a record high of $4.4-billion, according to Stéfane Marion, chief economist at National Bank Financial Inc.
That could add a full percentage point to Quebec’s economic growth, according to Mr. Marion.
One of the key drivers is Quebec’s Plan Nord, a series of mining and infrastructure projects in the province’s north that will lead to over $80-billion in investment over 25 years, according to the government’s website for the plan.
“Quebec’s mining sector is becoming an important growth driver for the province,” Mr. Marion said in a recent report.
The level of investment in mining expected this year is getting close to the $5-billion of the province’s manufacturing sector, the economist notes.
“This unprecedented development suggests a very profound change to the province’s industrial structure,” Mr. Marion said.
Canada’s puny exports to China China’s ability to move Canada’s financial markets is huge, even though as a destination for Canadian exports, the Asian country remains puny.
The value of Canada’s shipments to China, the world’s fastest-growing major economy, surged tenfold during the past two decades and amounted to $16.8-billion last year, but that represented a measly 3.8 per cent of total exports. Shipments to the United States accounted for more than 70 per cent.
Two weeks ago, the S&P/TSX index fell sharply after China cut its economic growth forecast. One reason China can cause Canada’s stock market to swing is that the Asian country is a major consumer of potash, iron ore, gold, copper, lumber and other commodities, and demand from China affects prices of those products worldwide. Companies that produce or process those commodities account for many of the listings on the Toronto Stock Exchange.
“China slowing down is not really an export story, it’s a commodity story,” Benjamin Tal, an economist in Toronto at CIBC World Markets Inc., said in an interview. “And given the fact that we are a commodity-based economy and the TSX is heavily impacted by the commodity market, what happens in China is really impacting Canada.”
Auto sales move into the fast lane Trends in Canadian car buying suggest consumption may be boosting employment and the economy more than expected, especially in Quebec.
Nationwide auto sales soared to the second-highest monthly level on record in January. Based on Statistics Canada’s preliminary estimate for February, the outlook for the first quarter is bright, according to Krishen Rangasamy, an economist at National Bank Financial Inc.
“Those numbers tell us that the Canadian consumer is doing well,” Mr. Rangasamy said in an interview. “If they’re spending on durable goods, it must mean they’re confident about what the economy is going to do.”
And while car purchases in January gained in all provinces, Quebec saw an increase of almost 10 per cent despite a 1 per cent hike in the province’s sales tax, Mr. Rangasamy noted in a report.
“That adds to mounting evidence that Quebec’s employment picture may be a tad better than what’s implied by the Labour Force Survey,” Mr. Rangasamy said.