Alberta is once again at risk of being downgraded by a rating agency if it does not do anything to control its spending, according to the rating agency.
DBRS warns that the province may see its credit rating decline over the next year “in the absence of sustained efforts to meet the budget deficit and the gradually rising debt”.
The Alberta government forecast in its latest update that economic growth would be higher than expected, but that the anticipated deficit would remain the same at $10.5 billion. However, the debt must reach 43.3 billion instead of the 45.1 expected earlier.
“The deterioration in the commodity price outlook increases the likelihood of a negative rating action,” said DBRS, which currently gives Alberta a AA (high) rating.
In July, DBRS changed its long-term forecasts for Alberta from stable to negative while maintaining its rating at “AA (high)”. However, S&P Global had downgraded the province’s rating from AA to A + in May.
Benjamin Diaz started working for Debate Report in 2017. Ben grew up in a small town in northern Ontario. He studied chemistry in college, graduated, and married his wife a year later. Benhas been a proud Torontonian for the past 10 years. He covers politics and the economy. Previously he wrote for CTV News and the Huffington Post Canada.