NUNAVUT ECONOMIC STRATEGY OUTLOOK

Transcription

1 NUNAVUT ECONOMIC STRATEGY OUTLOOK NEF Presentation Tuesday September

2 Overview 2 Some quick history about the Nunavut Economic Forum or NEF What does Nunavut s Economic future look like between now and 2030? Where will there likely be some major opportunities? What are our major obstacles? How might we maximize our opportunities? I

3 The Nunavut Economic Forum 3 NEF formally established in early 2004 Creation and role part of the first Nunavut Economic Development Strategy launched in June 2003 by NTI and the Government of Nunavut NEF was established then to monitor the implementation of the Strategy NEF is a Not-For-Profit Society with about thirty members composed of a broad spectrum of organizations, agencies and government departments a players in our developing economy. Members represent broader constituencies

4 How does the NEF Function? 4 Members fall under various categories and Each category is represented on our Board of Directors Financial Support comes from Nunavut Tunngavik, Government of Nunavut, Government of Canada and Members Categories include: Inuit Organizations; Inuit Development Organizations and Corporations; Territorial and Federal Government Departments and Agencies; Chambers of Commerce; Non-Government Organizations, Municipal Governments, Labour and Sector Organizations. The NEF functions as an independent arms-length organization

5 Key Questions About Our Economy 6 Where is the Nunavut economy heading? Where are we are likely to foresee economic opportunities through development? And what are obstacles and threats? How might these influence Nunavut s Economic Strategy going forward?

6 7 The Next Nunavut Economic Development Strategy Learn more about the work we have been doing preparing for the next Nunavut Economic Development Strategy by visiting our website

7 A Look Ahead 8 With Help from The Conference Board of Canada Data and comments from the Conference Board s Territorial Outlook Forecast Summer 2017 An economic forecast of all three territories Marie-Chrstiane Bernard a Senior Economist with the Conference Board oversees development of these reports Available through subscription by contacting the Conference Board of Canada

8 And a quick advertisement! 9 The Conference Board will shortly commence work on the next Nunavut Economic Outlook Report This will be the seventh in this important series and Marie Christiane Bernard will be the senior economist working as a key member of the team working on this report. The Conference Board of Canada produced the first two reports. Look for the next Outlook to be available in early 2018.

9 10 So what does the economic forecast tell us? Of the three territories Nunavut s immediate future may look the brightest. Nunavut s economy has remained strong through the correction in commodity prices and that will continue in 2017 with an expected 6.4 % growth forecast for our territorial economy. While there will be an expected slight decline of 0.2 % in 2018 following that we will be well positioned to experience an average 2.5 % growth in GDP after 2018 over the subsequent 12 years to 2030.

10 Mining 11 Metal Mining will likely be the single largest contributor to this economic growth All of our operating mines are planning increases in production Mines are now operating and in production all three Nunavut Regions: Kitikmeot TMAC Gold - Hope Bay (Gold) Kivalliq Agnico Eagle - Meadowbank (Gold) Qiqiktani Baffinland - Mary River (Iron Ore)

11 And a closer look at Mining 12 Agnico Eagle s Meadowbank mine will start to wind down its operations in 2018 and will ultimately be replaced by it s new Amaruq satellite site Amarauq is expected to receive the necessary permits by mid-2018 and to be fully in operation by The Mill at Meadowbank will process the ore with about 500 workers compared to the 700 workers now employed at that facility. Baffinland is planning to increase its production and hopes to construct a railway to transport their ore to Milne Bay awaiting regulatory review TMAC s Hope Bay Mine includes four sites the first Doris North is now operational other three set to begin operations soon

12 Mining Challenges 13 Commodity prices seem to be moving in the right direction but are always subject to market fluctuations Potential Carbon Tax has mining companies in all three territories with productions underway or undertaking exploration worried about increased costs Nevertheless, the Conference Board of Canada expects real mining output to surge in Nunavut by as much as 24% in 2017.

13 Further mining prospects 14 Not included by the Conference Board s forecasts are any of the mining projects currently in the exploration phase several could be developed during their forecast period. The Chidliak diamond mine is cited as one such prospect - owned by Peregrine Diamonds with further exploration dollars dedicated for expenditure in 2017 the company hopes that permitting might be complete by production might come as early as 2021.

14 And one last comment about 15 mining in Nunavut The Conference Board also makes one other important observation: Nunavut does not score high among mining executives in terms of our regulatory review process A Fraser Institute survey conducted last year reported that 45% of respondents indicated that Nunavut consistently failed to meet its own established timelines with the worst record of doing so of any Canadian jurisdiction

15 Other sectors of Nunavut s economy 16 The construction sector will continue to surge in 2017, but will then weaken Various public projects such as Iqaluit s new Airport will be completed soon Decline in construction may be partially offset by Agnico Eagle s new Kivalliq projects, at least in 2018, but will wind down again in The Conference Board is also noting an anticipated decline in government spending on infrastructure commencing in Service-based industries will benefit from Nunavut s strong population growth. The Offshore Fishery continues to grow in importance and increasing numbers of Nunavummiut are finding training and employment opportunities.

16 Other sectors (continued) 17 Since 2001, Nunavut s share of its adjacent turbot resource has increased from 27.3% of the 5,500 tonne quota to 73.9% of the current 16,150 tonne quota, 11,842 tonnes held by Nunavut interests. There is a similar result with the Shrimp Fishery as well. Nunavut has 11,030 tonnes of shrimp directly allocated to the territory. Combined we have improved from a share of adjacent turbot and shrimp quotas of 13.1 percent in 2001 to 50.7 percent in In 2016/17, the Nunavut Fishery and Marine Training Consortium provided 26 courses and achieved a 98 percent completion rate with 223 Inuit completing these courses. Focused on increasing the level of training for Inuit in the fishery so that they can increase their level of responsibility.

17 Our Telecommunications Challenge(1) 18 The NEF has for a long time noted our unique challenges regarding telecommunications across the territory - in particularly our High Speed Internet deficit compared to southern Canada Nunavut remains the only jurisdiction in Canada dependent on Satellite for all of our telecommunication services We led a coalition in June in order to file an intervention with the CRTC concerning their proposed Broadband Fund and we filed a follow-up submission with further questions in August. This morning the BRCC made the whole morning available for a full discussion on the issue backed by a seven-person expert panel. The NEF applauds the BRCC and the Nunavut Trade Show for this initiative. The costs to normalize our situation in Nunavut will be enormous and there is no clear direction on what will be the best solution(s) and the best technological solutions. More study is needed.

18 Our Telecommunications Challenge(2) 19 The NEF is hosting a meeting on Thursday afternoon to discuss the possibility of creating a Telecommunications Task Force. We would welcome your participation. Baffin Room Frobisher Inn - 2:00 PM - Please let us know if you plan to attend Terry Forth neforum@ qiniq.com Visit our Booth for more information

19 Other Factors 20 Employment forecasted to grow slightly faster than the Labour Force May allow for solid increases in real wages and salaries per employee which in turn will improve the government s fiscal position. Nunavut has the youngest and fastest growing population of any jurisdiction in Canada. The Conference Board notes an average population growth rate of 1.6 percent between 2017 and 2030, compared to 0.9 % across Canada. Thus we should see a population of about 50,000 by While seniors as a group will increase, Nunavut will still have a much higher ratio of youth compared to seniors by 2030 the only jurisdiction in Canada to show that result. Nevertheless, the increasing number of seniors may result in new service sector business and employment opportunities as care-giver needs grow.

20 The Ottawa Phenomena 21 The Ottawa-based community organization - Tungasuvingat Inuit have recently indicated that there may be as many as 5000 Inuit living now in Ottawa They may be moving mainly because of housing and generally lower living costs Many continue to take employment back in Nunavut - with the mines for example on a fly-in flyout basis the same as the mining company s southern hires. Living in Ottawa, however means that they are no longer resident in Nunavut What are the implications? Is it a short-range or long range issue?

21 22 Some other considerations where more study may be warranted Some unanticipated migratory population patterns within Nunavut could become important factors to our economic future. Nunavut Land Claim Agreement negotiators were concerned about creating government employment opportunities in communities across Nunavut and this led to the establishment of 11 decentralized communities for provision of government services within Nunavut. Including Iqaluit with a total of five such communities in the Qikiqtani region and three each in the Kivalliq and Kitikmeot regions. We are asking that the Conference Board take a closer look at this phenomena as it appears that there has been a far greater interest in moving to larger communities particularly Iqaluit to take advantage of employment opportunities primarily government, but not exclusively. We are looking for more data on this with the next outlook.

22 Demographics - Out Migration 23 Planners and Land Claim Negotiators did not expect net out-migration to be an issue, but currently all of Nunavut s population growth is based on our exceptionally high birth rates the highest in Canada. The Conference Board expects our net outmigration between now and 2030 will average 149 people per year. Some, if not most, are Inuit. Many flock to Ottawa

23 24 How Do We Maximize our Opportunities Over the next 12 years Nunavut appears to be well positioned to benefit from increased mining activity Many new and existing Nunavut-based businesses have benefited from taking on activities which either directly or indirectly support the mining sector Existing and emerging businesses need to be creative and consider all of the opportunities that may be available. Activities in each sector will bring about new possibilities. Programs such as those available through the Office of Small and Medium Enterprizes of Public Works and Government Services Canada for assistance in gaining access to Government of Canada procurement opportunities. My panelist partner La Vona will be speaking t about hat program shortly.

24 25 Maximizing Opportunities (continued) Both the Government of Canada and the Government of Nunavut also provide various programs to assist businesses in Nunavut to obtain funding support to establish or expand their operations. Inuit Development Organizations such as Kakivak, and Kivalliq Partners in Development, as well as Atuqtuarvik Corporation have specialized assistance and services available to existing or potentially new Inuit entrepreneurs with business ideas they wish to pursue. There are also Community Futures Organizations such as the Baffin Regional Development Corp. available to offer assistance to both Inuit and non-inuit entrepreneurs The Nunavut Business Credit Corporation is also able to offer assistance.

25 26 THANK YOU And once again a commercial messages: The NEF is hosting a meeting on Thursday afternoon to discuss the possibility of creating a Telecommunications Task Force. We would welcome your participation. Baffin Room Frobisher Inn - 2:00 PM - Please let us know if you plan to attend Terry Forth neforum@ qiniq.com

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