Canada's Northwest Territories will reap economic benefits from an upswing in diamond mining, the Territorial Outlook reports.

Diamonds are the Northwest Territories' most important mineral commodity, but the diamond industry was hit hard by the recent recession and decline in luxury spending. However, the diamond trade reports that prices are going up and are close to what they were pre-recession.

In total, the Northwest Territories' GDP is expected to rise 4.8% this year, although employment is not expected to see a boost until 2011.

Last year, the Yukon led all provinces and territories, showing 1.4% economic growth. The metal mining and construction industries are expected to expand, and estimates put the total GDP growth at 4.9% by the end of 2010.

Nunavut, which last year saw an economic slide of 10.6%, is projected to undergo a 12.9% rebound, due in a large measure to the fact that work on the Meadowbank gold mine is finished.

The forecast for Canada's three northern territories was put out by the Conference Board's Centre for the North, a program designed to research and strategize sustainable prosperity in northern Canada.