- BMO Blue Book combines expertise of BMO's economists with
information on business conditions from its bankers
- Small businesses are the foundation of local economies and
their rebound will influence Canada's recovery
TORONTO, July 22, 2020 /CNW/ - Following the steepest,
deepest, and fastest recession in history, there are clear signs
that the Canadian and global economies have begun the initial
stages of recovery, according to the newly-released BMO Blue Book:
Small Businesses in the Recovery.
The BMO Blue Book, published by BMO Economics and BMO Business
Banking, combines the expertise of BMO's economists with
information on current national and provincial business conditions
provided to BMO's business bankers by local businesspeople. The BMO
Blue Book features a report for Canada at large, each province and the
Greater Toronto Area. This edition
also features an outlook for five key sectors of the Canadian
economy: technology, agriculture, energy, manufacturing and
construction.
The BMO Blue Book states that the Canadian economy will contract
by roughly 6 per cent in 2020, by far the deepest annual decline in
economic activity in the post-war era. "Yet, as we have
consistently maintained since the shutdowns began, growth is
expected to rebound to roughly 6 per cent next year, helping bring
the jobless rate down markedly," said Doug
Porter, Chief Economist, BMO Financial Group. "Even with a
forceful recovery, the challenge will be to get the economy back to
full health. It will undoubtedly be a bumpy road but, as key
drivers of Canada's economy, it's
vital to understand how businesses will be affected over the coming
months."
"As the Bank for Business, we stand ready to support our
customers during these challenging times," said Ernie (Erminia) Johannson, Group Head, North
American Personal and Business Banking, BMO Financial Group. "The
BMO Blue Book represents another part of our effort to provide
specialized content and resources to help our business clients
navigate the COVID-19 pandemic and economic recovery. Now more than
ever, we need to work with our clients to support their needs and
provide them with opportunities to make clear financial
progress."
"Small businesses have been more adversely affected by the
economic downturn resulting from COVID-19," said Mike Bonner, Head, Business Banking, BMO Bank of
Montreal. "It's crucial that we
all help small businesses bridge the gap back to profitability –
they are the foundation of local economies across this country and
account for a large portion of local tax revenue and local
employment. Their rebound will influence Canada's recovery."
Provincial forecasts at-a-glance according to the BMO Blue
Book:
Western Canada:
- British Columbia's economy is
expected to contract 5.3 per cent this year, but rebound to 6.3 per
cent in 2021. Unemployment is expected to remain below the national
average.
- Alberta's GDP decline will be
deeper than in the rest of the country. The province has been
faster to re-open, with the CFIB reporting that almost 60 per cent
of small businesses were fully open as of mid-June.
Prairies:
- Saskatchewan's economy will
contract 6.2 per cent this year. That said, the COVID situation has
been milder than in most other provinces – leaving the province
flexibility to re-open earlier.
- Manitoba's economy is expected
to contract 4.8 per cent in 2020, milder than the national decline.
Manitoba has typically weathered
downturns much better than the rest of Canada, but COVID-related lockdowns will still
weigh heavily.
Central Canada:
- The Ontario economy is
expected to contract 6.0 per cent this year, in-line with the
decline expected nationally. The province entered the downturn in a
position of strength, but struggled with a steeper COVID curve
early on.
- The Quebec economy is expected
to decline 6.3 per cent this year, slightly worse than the national
figure given more widespread shutdowns early in the pandemic.
Atlantic Canada:
- Nova Scotia, New Brunswick and PEI are all seeing GDP
contractions that are milder than the decline expected nationally,
with reductions of 3.8 per cent, 3.2 per cent and 3.0 per cent,
respectively. Faster re-opening in these provinces has provided
significant benefits.
- The Newfoundland &
Labrador economy is expected to contract 7.5 per cent this year,
deeper than the decline expected nationally. The province was
already in a challenged position pre-COVID, and current shutdowns
and the decline in oil prices have exacerbated the headwinds.
The BMO Blue Book can be downloaded at:
https://bmoficc.bluematrix.com/sellside/EmailDocViewer?encrypt=97c0d8cd-f2d4-430e-82d2-b73dce5354f9&mime=pdf.
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly
diversified financial services provider - the 8th largest bank, by
assets, in North America. With total assets of $987
billion as of April 30, 2020, and a team of diverse and
highly engaged employees, BMO provides a broad range of personal
and commercial banking, wealth management and investment banking
products and services to more than 12 million customers and
conducts business through three operating groups: Personal and
Commercial Banking, BMO Wealth Management and BMO Capital
Markets.
SOURCE BMO Financial Group