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Resin Outlook 2002: The economy: A limp recovery in 2002

"The North American economy will pull out of this next year," is the prediction made by Peter Drake, vice president and deputy chief economist, TD Bank Financial Group. All of Drake's indicators show ...


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December 1, 2001 by Canadian Plastics

“The North American economy will pull out of this next year,” is the prediction made by Peter Drake, vice president and deputy chief economist, TD Bank Financial Group. All of Drake’s indicators show that this fourth quarter of 2001 is the turning point; improvements are in the cards for 2002.

But it will be a limp recovery. The economy will have little vigor until the second half of the year, reports Drake.

One factor contributing to the gloomy economic performance this year is that there was, and is, no other world economy showing strong growth. Growth in the European Union and Latin American regions is predicted to be between 1.5 to 2.7 for 2001 and 2002. Japan will experience slightly negative growth as it “finally comes to grips with serious structural problems,” says Drake. Asia (excluding Japan) is the only bright spot with growth hovering around 5 percent for this year and next.

For Canada, the real Gross Domestic Product is forecast to grow to from 2.1 percent in the early part of 2002 to 3.8 percent in the fourth quarter. During 2003 it will dip again to end the year at 2.7 percent.

Bad news for exporters: One of Drake’s forecasts has already proven true. The Canadian dollar is experiencing record lows, but it should rise steadily in 2002 and 2003 to about US$0.69, according to Drake.


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