Québec gross domestic product down in fourth quarter 2015

Québec, March 30, 2016 – Gross domestic product (GDP) at market prices was down 0.1% in real terms in the fourth quarter of 2015, an annualized decrease of 0.3%. On an annual basis, real GDP expanded 1.1% in Québec versus 1.2% in Canada. The decline in GDP in the fourth quarter was essentially due to a drop in fixed capital investment and business inventories, which was dampened by an improved foreign trade balance and growth in final consumption expenditure. That was revealed in Comptes économiques du Québec, 4e trimestre 2015 published by the Institut de la statistique du Québec.

Third consecutive annual decline in business investment

For the year 2015, GDP growth was the result of an improved foreign trade balance and higher final consumption expenditure. However, gross fixed capital formation was down for the third consecutive year. Final domestic demand increased by 0.4% in 2015, after posting a decline in 2014 (-0.2%).

Household spending on goods and services grew 1.4% in 2015, a rate similar to that of 2014 (+1.5%), largely due to increased spending on services rather than on goods. Spending on durable and semi-durable goods grew by 3.0% and 1.0% respectively, while spending on non-durable goods declined 0.2%. Household final consumption expenditure on services increased at the same rate as in 2014 (+1.8%).

In 2015, gross fixed capital formation was down for the third consecutive year with a 2.3% decline, after decreasing 4.8% in 2014. Business fixed capital investment shrank by 2.9% (-6.5% in 2014), as did government investment (-0.3%). Business investment in residential structures was down 0.5% after declining 0.1% in 2014. Business investment in machinery and equipment contracted 1.1% after a sharp drop of 10.7% in the previous year. Investment in non-residential structures  (-8.1%) recorded a significant decrease for the second consecutive year, as it declined by 14.3% in 2014. Investment in intellectual property (-3.8%) fell for the fourth year in a row.

Total exports of goods and services rose 2.4% in 2015, after a 4.5% increase in 2014. International exports of goods (+4.6%) saw the most growth, as international exports of services posted a smaller increase (+1.2%). Total imports (+0.7%) grew faster than in 2014, when they increased by 0.3%. The increase in imports was more pronounced in international trade (+0.8%), more specifically of goods (+0.9%), as international imports of services rose by 0.2%. In 2015, the foreign trade balance improved for the third consecutive year and stood at - $10.8 billion.

GDP by industry up in December

Québec’s real gross domestic product at basic prices went up 0.2% in December 2015, on the heels of two consecutive declines (-0.3% in November and -0.3% in October). In Canada, GDP rose 0.2% in December. Goods-producing industries recorded a 0.4% increase, while services-producing industries rose by 0.2%. That was revealed in the December 2015 issue of Produit intérieur brut par industrie au Québec published by the Institut de la statistique du Québec.

Goods-producing industries recorded a 0.4% increase, following two consecutive drops (-1.2% in November and -1.2% in October). The rise in December came from increases in mining, quarrying, and oil and gas extraction (+9.4%) and manufacturing (+1.7%).

Service output rose 0.2% in December, following a 0.1% increase in November. There were notable gains in wholesale trade (+0.9%), transportation and warehousing (+0.9%), finance and insurance (+0.9%), real estate and rental and leasing (+0.5%), educational services (+1.2%) as well as public administration (+0.6%). However, significant drops were recorded in retail trade (-1.7%), professional, scientific and technical services (-0.9%), and health care and social assistance (-1.2%).

Output in the manufacturing sector was up 1.7% in December, following a 0.2% rise in November and a 0.3% decline in October. The rise in December was attributable to an increase of 2.1% in durable goods manufacturing and of 1.2% in non-durable goods manufacturing.


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Sources:

  • Jean-François Fortin
    Economist
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  • Réjean Aubé
    Economist
    Phone: 418-691-2411, Ext. 3142

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