Federal Finance Minister Jim Flaherty says New Brunswick should look to other provinces for development projects to boost its struggling economy.

The federal finance minister used Fredericton as the backdrop for his latest fiscal update on Tuesday where he outlined the pressures facing the federal government.

He also used the opportunity to discuss how New Brunswick should look beyond its borders for economic development opportunities, especially as megaprojects, such as the Point Lepreau refurbishment project, are winding down.

"It's important that we try to move western oil to New Brunswick and through the great port of Saint John, which as you know, is a deep water port. It takes ships that cannot be taken in Quebec City or Montreal. That's an incredible opportunity for New Brunswick going forward,” he said.

“There's shipbuilding that's going to happen in Nova Scotia which is going to have a value for jobs in New Brunswick as well."

Flaherty said he met with Premier David Alward and Finance Minister Blaine Higgs to discuss transfer payments and potential infrastructure projects with federal funding.

The New Brunswick government was hit by a double-whammy of dismal economic news earlier this month.

Finance Minister Blaine Higgs announced earlier this month the provincial government’s projected deficit had nearly doubled to $356 million. (CBC)

Statistics Canada reported the province’s unemployment rate was 11.6 per cent in October, which is the highest level since May 2003.

As well, the province’s finance minister said his estimate for the province’s deficit nearly doubled to $356-million.

In a speech to the Fredericton Chamber of Commerce, Flaherty said on Tuesday the federal deficit will jump to $26.2 billion — up $5.1 billion from the $21.1-billion estimate in his March budget.

Transfer payments

The federal finance minister also brought some good news to New Brunswick with a commitment that no province would see a reduction in transfer payments next year.

Flaherty said a federal program that has delivered about $350 million to the New Brunswick government over the last three years may not be cut in his next budget.

“Unlike governments in the past to balance the budget, we have not and will not reduce transfers to the provinces,” the finance minister said.

The New Brunswick government was scheduled to lose more than $100 million in federal transfer payments this year. But, the provincial budget was saved by the federal program that guarantees transfer funding will not fall from one year to the next.

In 2012, the provincial government received $2.8 billion in federal transfers payments, which accounted for 36.9 per cent of the province’s total revenue.