Amid drops in industries such as mining and manufacturing, Quebec’s GDP shrank 0.5 per cent in May. Quebec Finance Minister Carlos Leitao said he’ll likely lower his growth estimate for calendar 2015.Jacques Boissinot/The Canadian Press
Quebec Finance Minister Carlos Leitao said he'll likely lower his growth estimate for calendar 2015 even as he reiterated a pledge to balance the books this fiscal year.
In March, Mr. Leitao projected economic growth of 2 per cent for 2015 while introducing a balanced budget for the fiscal year that ends in March, 2016. Gross domestic product in Canada's second-most-populous province expanded 1.5 per cent in 2014.
Quebec's GDP shrank 0.5 per cent in May – amid drops in industries such as mining and manufacturing – after a decline of 0.3 per cent in April, according to data from the province's statistics institute. Figures for the quarter ended June 30 will be released later this month.
"We are going to take into account the new data, but it's quite probable that the 2 per cent we forecast in March won't materialize" for 2015, Mr. Leitao said on a conference call with reporters from Quebec City.
Mr. Leitao made the comments as Quebec reported a deficit of $675-million for the quarter ended June 30. That compares with a shortfall of $1.28-billion in the same period a year earlier.
Budgetary revenue rose 3.8 per cent in the first quarter, outpacing an 1.1-per-cent increase in program spending, Finance Ministry figures show. Those trends give Mr. Leitao confidence that the province will balance the books as planned in 2015-16.
"I'm not at all concerned" by weaker GDP growth, he said. "We're not seeing any deterioration in revenue. Even if GDP is a little less robust, consumer spending and the activities that generate revenue for the government don't seem to be too affected."