The P.E.I. government said it is now expecting a $178.1 million deficit this year, up $5.4 million from the budget tabled in June.
However, it says keeping COVID-19 in check within the province has provided the economy with a bit of a boost.
In a fiscal update released Wednesday, the province said it expects the economy to shrink by 3.9 per cent in the 2020-2021 fiscal year, as opposed to a 5.1 per cent decrease projected in June.
The province said a lack of COVID-19 cases on the Island allowed businesses to re-open earlier than other parts of Canada. P.E.I. has had a total of 59 cases, with no community transmission.
"Prince Edward Island has not been immune to the economic impacts of the global pandemic; however, we have fared better than most provinces and in our initial projections," said Finance Minister Darlene Compton in a news release.
"Our economy continues to move forward, and the hard work, ingenuity and resiliency of Islanders will allow us to renew and strengthen our economic position for the betterment of everyone."
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