This report does not constitute a rating action. An economic rebound and management focus on longer-term fiscal sustainability will help budgetary performance recover in the next two years. We expect economic growth to gradually return to pre-pandemic levels during the outlook horizon, spurred by continued population growth. The Province of Prince Edward Island (PEI) has not articulated a target for a return to fiscal balance, but we expect that prudent financial management will result in gradual improvements in budgetary performance in the next two years. The province's relationship with the federal government will remain well-balanced and predictable. Although the pandemic has had a material impact on the province's financial metrics, we believe that the gradual recovery in the next two
