With a mission to inform, empower, celebrate and advocate for British Columbia's current and aspiring business leaders, BCBusiness go behind the headlines and bring readers face to face with the key issues and people driving business in B.C.
Issue link: http://digital.canadawide.com/i/1490198
I T M I G H T N O T T E C H N I C A L LY B E A R E C E S S I O N , B U T I T ' L L B E C L O S E "What I'm hearing and learning is that it's going to be a tough 12 to 18 months, with a moderate recession on the horizon," says Fiona Famu- lak, president and CEO of the BC Chamber of Commerce. Famulak isn't the only one pick- ing up on this. Many experts are sharing similar opinions, though there are differences in how the months ahead might look and feel. On the national front, economists from the Royal Bank of Canada to Australian financial giant Macquarie Group are predicting a recession for Can- ada. Some, like Macquarie, even think it will be "severe." What the future holds specifically for B.C. is less clear, but it will be hard to com- pletely avoid the dreaded "R" word. "Generally, higher interest rates will slow the economy," says Rob Edel, chief investment officer at Vancouver- based finan- cial management firm Nicola Wealth. "This will extend well into next year, and be partially dependent on the terminal rate central banks end up at." Edel notes that while we could see a pivot in rates to provide relief for markets, "overall, we are likely headed for a recession—the question is severity and duration." Ken Peacock, senior vice president and chief econo- mist at the Business Council of British Columbia, has a slightly rosier view. "I actually don't think B.C. and Canada will go into an out- right recession," he says, arguing that while the province and country "could get a couple soft quarters" due to slowing economic growth, "we might escape a technical, actual recession by the numbers in 2023." I f you've been following recent economic activity, it shouldn't be a shock to hear that British Columbians could be in for some tough times in the next year. With inflation roaring and interest rates breaking records, it's natural to assume it might just continue through the new year. After all, the bill for all that spending to get us through the pandemic had to arrive at some point, right? Experts in various industries mostly agree that we'll con- tinue to go down a tricky economic slope, but they differ in many of the details. How long or bad will it be? And what should the people in charge prioritize in order to emerge in the best shape on the other side? We talked to a few in the know and got their insights on what we should expect. Here are some themes for what's ahead. 44 BCBUSINESS.CA JANUARY/FEBRUARY 2023 ECONOMIC OUTLOOK 2023 RECESSION IN SESSION?