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Ontario Economy Continues To Grow And Create Jobs

Private Sector Predicts Growth To Strengthen Over Medium Term

     QUEEN'S PARK, ON, Oct. 26 /CNW/ - Ontario's investments to strengthen jobs and growth and prudent fiscal management continue to be the cornerstones of the Province's solid economic foundation, according to the 2006 Economic Outlook and Fiscal Review released today.

     "Ontario's economy continues to grow and create jobs, although projected growth has moderated due to external factors such as a slowdown in the U.S. economy, high oil prices, and a strong Canadian dollar," said Finance Minister Greg Sorbara. "However, our ongoing investments in health care, education and infrastructure, as well as our disciplined fiscal management have put Ontario in a solid position to withstand these challenges and make the transition to a period of stronger growth."

     The Ministry of Finance has reduced its Gross Domestic Product (GDP) growth projection for 2006 to 1.6 per cent, down from the 2.3 per cent forecast in the 2006 Budget. Ontario economic growth is expected to strengthen over the medium term to 2.0 per cent in 2007, 3.0 per cent in 2008 and 3.1 per cent in 2009. Private-sector forecasters expect Ontario to grow faster than most G7 economies over the 2006 to 2009 period.

     The government is on track to meet its 2006-07 deficit target of

$1.9 billion, or $0.9 billion if the reserve is not required. Due to

moderating short-term growth, the government has revised its deficit

projection for 2007-08 to $2.2 billion - up from $1.5 billion. If the reserve

is not required, the deficit would be $0.7 billion. By 2008-09, a deficit of

$1.0 billion is projected - or a surplus of $0.5 billion if the reserve is not

required.

     "While the economy remains fundamentally strong, it is important to

remember that slower growth has a real impact on people and communities," Sorbara said. "We are therefore undertaking a number of focused measures to boost jobs and growth."

     These measures include funding for services and programs to help workers adjust, fast-tracking a number of infrastructure projects, promoting Ontario tourism and strengthening inter-provincial trade.

     Sorbara also called on the federal government to treat Ontarians fairly.

     "Our request is simple - we expect the federal government to honour the Canada-Ontario Agreement and to treat Ontarians fairly in the areas of health and social transfers, infrastructure funding and support for workers," he said. "We invite the people of Ontario to join us as we continue to press the federal government to honour its commitments to our government and to fulfill its responsibilities to Ontarians."