Canada’s Parliamentary Budget Officer (PBO) estimates February’s rail blockages will not have a significant impact on GDP growth in 2020.

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In a Friday report quantifying the economic impacts of the rail disruptions, the PBO estimates the annualized rate of GDP growth in the first quarter of 2020 will be 0.2 per cent lower due to the disruptions, but that the second quarter will see a 0.22 per cent rebound in higher growth.

Overall, for 2020, the disruptions are expected to have little to no impact on growth and total GDP levels.

However, the PBO said 1,010 jobs were lost in the first quarter and not all will return by the end of the year. For 2020, the budget officer predicts the blockages will result in employment losses equal to 772 jobs.

The PBO compared the actual scenario with a counterfactual scenario in which the disruptions did not occur.

The rail blockades were put up in February by protesters in support of Wet’suwet’en hereditary chiefs opposed to the Coastal GasLink project in northern British Columbia. The demonstrations temporarily restricted the movements of goods and people on rail lines, as well as shipping from Vancouver’s port.

The PBO said lost rail transportation activity — with the exception of Via Rail — would be fully recouped by the end of May.

That would mean 924 in revenue-ton miles, a metric used by the transportation industry to gauge revenue based on moving one ton of goods over a mile, would be made up between now and the end of May.

The PBO also said 273,000 passenger trips were lost in February. Via Rail laid off 875 workers that month.

Companies are also expected to lose $132 million in pre-tax profits in 2020 as a result of the disruptions.

Despite the disruptions’ limited impact on GDP, Canada nevertheless faces a difficult economic situation in 2020. The country entered into the year on sluggish growth and the coronavirus outbreak and low oil prices are expected to throw Canada into a recession.

RBC forecasted on Friday that Canada will fall into recession for the second and third quarters of the year.

The bank is forecasting an annualized decline of 2.5 per cent in the second quarter and 0.8 per cent in the third quarter before the economy picks up towards the end of the year.

The Bank of Canada, which is expected to further slash its key interest rate in April, noted in its rate cut explanation last week that the rail blockages had affected the economy.

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