B.C. budget could be even tougher than expected

There are more signs British Columbians are in for a tough budget on March 2, just two days after the Olympic Games end.

The latest figures from BC Stats show a 24-per-cent drop in the value of B.C. exports in 2009, a trend some analysts say could force more government belt-tightening and more industrial layoffs. 

'Exports are no longer a key driver of our economy' —Economist Helmut Pastrick

Exports of forest products, coal and natural gas to all of B.C.'s major markets — except mainland China — were down sharply.

The trend could be about to turn around, according to the Feb. 12 BC Stats report, which noted that exports rose slightly in December 2009, although the report did not specify if the increase was in volume or actual dollar value.

But if the downward trend seen throughout most of 2009 continued, it could mark a structural shift in the B.C. economy, according to Helmut Pastrick, chief economist for the Central One Credit Union.

"The fact exports are no longer a key driver of our economy is a real economic policy concern," Pastrick said.

Pastrick said B.C. exports have not dropped so sharply since the recession of the early 1980s.

Another observer said the economy in 2010 is more diversified and the impact would not be as great or the layoffs as numerous as in the past.

Still, political analyst Bob Plecas said exports won't really take off again until job growth picks up in the U.S.

"As long as 10 per cent of the public down there are unemployed, which they are, they're not going to be buying homes," said Plecas.

"When they don't buy homes, we don't sell lumber and that's our biggest concern, that the jobless recovery in the United States will delay our own forest industry, followed by gas, followed by electricity."