Canada’s Macklem Curbs Growth Forecast on Elusive Exports
We need a rotation in demand toward exports and business investment, Macklem said. Unfortunately, this rotation has proven elusive. After an initial burst following the recession, Canadas economy began to slow last year amid weak global demand for its goods and a slump in business capital spending . Until today, the central bank had predicted a recovery in exports would help fuel a rebound starting in the second half of this year, which would eliminate slack in the nations economy by 2015 and lead to higher policy interest rates. Investors are betting Governor Stephen Poloz will extend a three-year pause, the longest since the 1950s, by keeping his 1 percent benchmark interest rate unchanged until at least the end of next year. Monetary policy remains highly stimulative to provide time for the recovery in exports and investment to take hold, Macklem said today. Dollar Weakens The Canadian dollar extended declines following release of the speech, dropping as far as 0.3 percent to C$1.0337 per U.S. dollar . It traded at 1.0328 per U.S. dollar at 1:21 p.m. in Toronto. One Canadian dollar buys 96.82 U.S.
Canada’s energy industry faces a critical challenge on market access
But over the past year, in-bound foreign investment in Canadian energy has dropped off dramatically. Foreign investment is down 92 per cent this year at $2 billion , compared with $27 billion in the same period in 2012. Mergers and acquisitions activity in Canadian energy is similarly below historic levels – just $8 billion in 2013, compared with $66 billion in 2012, year to date. To address this, Mr. Prentice believes there needs to be a measure of clarity regarding State-owned Enterprises and foreign investment. ” Canada must make clear to the world that it continues to be open for business. Not everyone is getting the message that Canada remains open to the world. In fact, some are coming to believe the opposite. “There are large companies from non-market economies that have ambitions to come to Canada . They want to be headquartered in a stable western democracy. They want to use and benefit from Canadian technology, labour and capital markets. These are giant, world-class opportunities for Canada , but they don’t want to be rejected. They certainly don’t want an embarrassing confrontation with a western government and right now they are puzzled by Canada .” Mr. Prentice believes if Canada can overcome these three challenges then the energy industry will continue to remain a driving engine of Canadian economic growth.
Foreign Minister John Baird said Tuesday that he told his Egyptian counterpart that in “no uncertain terms” it is unacceptable. He said Canada’s prime minister has directed that all resources be brought to bear to secure their release. John Greyson, a filmmaker and professor, and Tarek Loubani, a physician, have been held without charges since mid-August and were ordered detained for another 45 days on the weekend. The men say they were observing an anti-government demonstration Aug. 16 when Loubani heeded a call for a doctor and began treating wounded demonstrators while Greyson recorded the unrest on video. The pair released a statement on Saturday saying they’ve been beaten and subjected to degrading treatment. “It is simply unacceptable that Canadians can be held this long with no specific charges, no specific evidence,” Baird said. Baird said he told the new Egyptian foreign minister that it was “a significant problem in our bilateral relations.” Baird said he “didn’t’ see any light at the end of the tunnel” despite holding what he called a productive meeting with his Egyptian counterpart on Friday. He said the Canadian government is taking both a political and judicial approach to securing their release. “The government, at the prime minister’s direction, has been engaged in a big way to secure the release of these two Canadians,” Baird said. “I don’t want to up the rhetoric that would impede their expeditious release. I would just say we’re having strong discussions with the Egyptian authorities on this.” Join the Discussion You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.