“It is not good news,” is how John Rose wrapped up his email to Global News in response to to Thursday’s Federal Court decision that overturned the federal government’s approval of the Trans Mountain pipeline expansion project.
The City of Edmonton chief economist will be delivering his updated forecast in late September, however, in an interview with Global News, he confirmed he’ll be dropping the city’s economic outlook by a couple of tenths of a percentage point for both the rest of this year and next.
Rose’s current GDP forecast is for 2.5 per cent growth this year, and three per cent in 2019. He said you can expect that to now come in in the range of 2.3 per cent and 2.8 per cent.
“Delaying the project will depress, to some extent, engineering and logistics and project management activities as well as manufacturing, just simply because the project’s been delayed,” he said.
Beyond that, it gets worse.
“I don’t think the immediate direct effects are going to be all that significant,” Rose said.
“My concern is longer term. When we get out to 2022 [and] 2023 and we simply don’t have the export capacity to move any additional oil out, that constrains investment.”
That’s when Rachel Notley’s NDP government was counting on increased royalties to help get the books balanced and pay off debt.
READ MORE: Notley pulling Alberta out of federal climate plan after latest Trans Mountain pipeline setback
Watch below: Some videos from Global News’ coverage of Thursday’s ruling by the Federal Court of Appeal.
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AB pulls out of climate plan after court quashes Trans Mountain pipeline expansion -
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Political analyst Duane Bratt discusses quashing of Trans Mountain pipeline -
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What went wrong with Trans Mountain pipeline expansion? Notley reacts -
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Getting Trans Mountain pipeline built ‘fundamentally important’: Notley -
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Federal government must appeal Trans Mountain pipeline court ruling: Notley -
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Alberta to pull out of federal climate plan after Federal Court quashes Trans Mountain pipeline -
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Political analyst John Brennan weighs in on Trans Mountain pipeline ruling -
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Federal Court quashes Trans Mountain pipeline expansion -
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The political and economic costs of kiboshing Trans Mountain -
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Moe on what any delay to Trans Mountain would mean for Saskatchewan -
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Court of Appeal ruling catches Trans Mountain supporters off guard -
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Reaction to bombshell court ruling to stop Trans Mountain pipeline construction -
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B.C. reaction on rejection of Trans Mountain expansion -
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B.C. Green Party leader on environmental impact of Trans Mountain pipeline -
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Reaction pours in after federal court quashes Trans Mountain -
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‘I think that Alberta will acknowledge this is a court ruling’: John Horgan on Trans Mountain case -
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‘Our coast was not considered by the National Energy Board’: B.C. premier on Trans Mountain ruling -
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Is the Trans Mountain pipeline project dead? -
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B.C. premier congratulates First Nations group on Trans Mountain court victory -
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No confirmation on break fee and if government will pay it to walk away from Trans Mountain
With about 27 per cent of employment in the Edmonton region being based in health care, education and public administration, Rose predicts cuts to the size of government would hit Edmonton “very hard and very fast,” especially if a number of political pundits are correct and there is a change in government next spring.
READ MORE: Trans Mountain pipeline decision: Experts discuss what could happen next
Adding to Rose’s pessimism are comments he said he’s hearing from the energy industry.
“‘If we can’t get this stuff built, why am I investing my money here?'” is one refrain Rose said he has heard over and over. “‘We’ve had revisions to the U.S. corporate tax system, why am I engaging here where the regulatory processes have become obscure and the goal posts keep moving.'”
READ MORE: Trans Mountain pipeline court decision ‘a real sad day for Alberta,’ says energy expert
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