Overall, this update demonstrates the government’s plan is working, as Ontario’s economy has remained resilient through heightened economic and geopolitical uncertainties. Despite the resiliency of Ontario’s economy so far in 2023, the province is not immune to any potential economic slowdown.
“The First Quarter Finances report shows that our government’s targeted, responsible approach is the right plan to build and support growing communities across Ontario,” said Peter Bethlenfalvy, minister of finance. “The people of Ontario can have confidence that this government is making responsible decisions to deliver on our Plan to Build by supporting people and businesses today while laying a strong fiscal foundation for future generations.”
Today’s report provides updated information about Ontario’s economic and fiscal outlook primarily as of June 30, 2023, and since the 2023 Ontario Budget for the 2023–24 fiscal year.
In the first calendar quarter of 2023, Ontario’s real gross domestic product (GDP) increased by 1.0 percent, supported by growth in exports and household spending. This follows a slight decline of 0.2 percent in the fourth quarter of 2022. As of the first quarter, Ontario’s real GDP stood 4.9 per cent higher than the pre-pandemic level in the final quarter of 2019. Since the 2023 Ontario Budget, private-sector forecasters have raised their GDP projections for 2023, reflecting better-than-expected economic performance so far this year. Expectations for GDP growth however have declined for 2024, due to the impact of Bank of Canada’s rapid policy interest rate increases – the fastest rise in the key policy interest rate since 1981 – and continued economic uncertainty.
As of the 2023–24 First Quarter Finances, the province’s 2023–24 deficit is projected to be $1.3 billion – unchanged from the outlook published in the 2023 Ontario Budget. Revenues in 2023–24 are projected to be $204.4 billion, and expenses are projected to be $204.7 billion, largely unchanged from the budget projections. New investments, funded from existing contingencies, include supports for Ontario’s manufacturing sector, policing and anti-crime initiatives, and municipal infrastructure.
“Ontario’s population is growing, jobs are being created and we are attracting investments in communities across the province,” added minister Bethlenfalvy. “To support these growing communities, our government will continue with its plan to build critical infrastructure, train and recruit skilled workers and provide people with the services they need.”