Credit agency says P.E.I. finances are stable but warns of economic challenges ahead

Prince Edward Island's provincial flag flies on a flagpole in Ottawa on July 3, 2020. THE CANADIAN PRESS/Adrian Wyld

Charlottetown — A global credit rating agency says Prince Edward Island’s economic outlook is stable but warns of future challenges from mounting debt and budget constraints.

Morningstar DBRS says it’s maintaining the province’s “A” credit rating in part because of the Island’s healthy economic growth.

The agency points to P.E.I.’s real GDP increase of 2.8 per cent in 2025, higher than the national growth rate of 1.6 per cent.

However, DBRS says the Island’s small economy, increasing government debt and need for revamped infrastructure all present challenges in the medium term.

Last month, two other agencies left their credit ratings for the province unchanged but downgraded the fiscal outlook of the Island from “stable” to “negative.”

Premier Rob Lantz’s government posted a record budget deficit of $410 million in April, and net debt is expected to grow to $4.9 billion by the 2028-29 fiscal year.

This report by The Canadian Press was first published June 29, 2026.

The Canadian Press