Alberta will be quick to make up for floods’ economic impact, bank predicts

TORONTO – TD Bank says Alberta’s economy will likely be quick to rebound from the flooding that has swamped Calgary and other parts of the province, although it says there are several unpredictable factors that could affect the recovery.

The bank’s economic unit estimates between $500 million and $1.5 billion will be subtracted from Alberta’s output this month — about 0.3 per cent of the province’s GDP — but predicts that shortfall will be made up in July.

The annual Calgary Stampede will be a wild card, it says, because flood damage to Calgary hotels may limit the number of visitors to the city, though that could be offset by increased support from Calgary residents.

On the whole, TD expects the flooding will have little impact on Alberta’s oil and gas industry — which accounts for about 29 per cent of the provincial economy — while the services sector will be hit the hardest.

It says Alberta’s retail, wholesale, rail and utility services will likely suffer the biggest economic fallout from the floods.

TD Economics also says rebuilding efforts and increased government spending could actually boost Alberta’s gross domestic product in the later half of 2013.

As a result, the bank says it’s increasing 2013 and 2014 growth forecasts for the Alberta economy.

TD has added half a percentage point to its 2013 growth forecast, raising it to 3.0 per cent, and increased its previous 2014 forecast of 3.3 per cent growth to a range of between 3.5 per cent and 3.7 per cent.