![\"A](\"https:\/\/www.canadianrealestatemagazine.ca\/wp-content\/uploads\/2023\/01\/Depositphotos_7802208_L.jpg\" "\\"-\\"")
<\/p>\nA petrostate, in its most basic of definitions, is a country whose economy is heavily dependent on the harnessing of fossil fuels to sustain its economy.<\/p>\n
By that very definition alone, Alberta does not meet the criteria of a petrostate because it is not, in fact, a country. However, a very strong argument can be made for the fact that the province of Alberta is or has been in the past reliant on the oil and gas industry, and many would argue much too reliant.<\/p>\n
<\/p>\n
Before we dig too deeply into this, I want to highlight that Canadian Real Estate Wealth is purposely sidestepping weighing in on the morality of economic dependence on oil and gas. There are already many opinions on that subject, and I\u2019m not sure that we have a new voice to add in favour of or against the ethics of that issue. Our interest instead is to understand the economic landscape, where Alberta may be headed, and what that means for Albertans and investors in Alberta for the future.<\/p>\n
Speaking of the economic landscape, according to Statistic Canada, the nation\u2019s governmental statisticians otherwise referred to as StatsCan, Alberta was and has consistently been for the better part of a decade, Canada\u2019s third heaviest hitter; the province trailed behind Ontario and Quebec in terms of its contribution to the overall gross domestic product (GDP) of Canada.<\/p>\n
Let\u2019s take a beat to look at Alberta\u2019s historical economic topography. According to economicdashboard.alberta.ca<\/em>, in January 2019, the province\u2019s GDP was at a three-year high of $335.1 billion. An all-too-familiar refrain that COVID-19 ruins everything rang especially true for Alberta. <\/p>\n In January 2020, the GDP drop down to $307.8 billion. With some economic recovery plans in place, the wild rose country experienced a sizable rebound, bringing its GDP up to $322.9 billion. <\/p>\n In June 2020, the provincial government launched an economic recovery plan amidst the worldwide pandemic and collapsing world oil prices. This economic reboot included investment in infrastructure, tax incentives, and employment grants to entice businesses to put roots in Alberta.<\/p>\n A principal focus of this economic rebound was the development of an innovation and technology strategy to provide channels of support for the rapidly-growing technology sector of Alberta to flourish. The innovation focus of the economic recovery plan invested in research at post-secondary institutions and seed money to tech start-ups.<\/p>\n We tapped Canadian Real Estate Wealth\u2019s trusted source Mark Verzyl<\/a> for his take on whether the transition from an energy-reliant economy has been a successful one. Mark has over 1.5 billion in real estate value sold and over 4,000 property sales in his career, so the man knows how to take the temperature of Albertans:<\/p>\n \u201cThe economic recovery plan has been massively successful at attracting new business to Alberta and more specifically Calgary. Mining, Oil, and Gas in the 1980s was over 40% of the GDP, in 2014 it was 27%, and today is under 24%. Tech companies are coming to Calgary in droves, driven by low taxes, cheap commercial space, plus an available and well-educated tech workforce. If you are employed by a company moving to Calgary, wouldn\u2019t you be excited by cheaper taxes, and real estate at \u00bd the price, not to mention it\u2019s rated in the top 4 cities for livability in the world (and has been for the past 12 years)? It\u2019s what brought me to Calgary in the first place.\u201d <\/p>\n According to businesscouncilab.com\u2019s report Alberta\u2019s Economy: An Overview<\/em>, Real Estate has replaced manufacturing as the second largest industry contributor to the province\u2019s GDP, followed closely by commercial and business services. We asked Mr. Verzyl<\/a> for his take on how that shift happened.<\/p>\n \u201cI couldn\u2019t say the specific date when Real Estate hit 2nd place on the list, but here\u2019s the truth: We put it on Ontario\u2019s investment radar starting in 2019, and it grew to viral status by 2021. It became the perfect storm; with migration, and immigration due to a higher standard of living, a massive tidal wave of investors came as we merely pointed out that it made a lot of investment sense. It checked all the boxes, with no rental controls, cash flow properties, significant ROIs, low closing costs, and an influx of working people, just to name a few. The Canadian Real Estate investors took notice. Once the door opened and the first wave of savvy investors started to buy, it grew to a tsunami.\u201d<\/p>\n For more insight into the factors that helped move the shift along, visit Canadian Real Estate Wealth\u2019s piece entitled, .<\/p>\n TD Bank\u2019s Provincial Forecast released on September 21, 2022, noted Alberta\u2019s economy has been enjoying robust growth so far this year amid surging crude oil and natural gas prices in the winter and spring. The soaring income performance was reflected in Alberta\u2019s Q1 fiscal update in which the government increased its budget estimate for the current year to a hefty $13.2- billion in surpluses. <\/p>\nThe State Of The Albertan Economy Now<\/strong><\/h2>\n
The State Of The Albertan Economy In The Future<\/strong><\/h2>\n