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BMO Financial Group

June 01, 2011 11:00 ET

BMO Blue Book: Prince Edward Island Economy Benefitting from Diversification

CHARLOTTETOWN, PRINCE EDWARD ISLAND--(Marketwire - June 1, 2011) - While economic growth in PEI will be relatively soft this year as stimulus spending winds down, diversification to sectors like bio-science is ensuring ongoing stability, according to the first edition of the BMO Blue Book, a joint publication of BMO Capital Markets Economics and BMO Commercial Banking. Much like the U.S. Federal Reserve's Beige Book, the BMO Blue Book combines the expertise of BMO's economists with information on current business conditions provided to BMO's commercial bankers by local businesspeople.

"Real GDP growth is expected to be 2.0 per cent, matching the pace seen in 2010, before cooling slightly in 2012 when capital spending really begins to contract," said Robert Kavcic, Economist, BMO Capital Markets.

"What might surprise outside observers most is the diversification of PEI's economy into new areas," said Christine Cooper, District Vice-President, New Brunswick and PEI, BMO Bank of Montreal. "Of particular interest is bio-science; it's a major focus of the provincial government and a large investment has been announced with the $4.65 million BioCommons Manufacturing Centre in Charlottetown. We can expect bioscience to be a key growth sector this year and beyond."

Ms. Cooper also noted success with the provincial government's nominee program for immigration. "Such immigration can only add more value to the economy through the purchase of daily essentials, plus cars and homes."

The full report can be found at www.bmocm.com/economics.

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