Friday, December 18, 2009

Canadian PM: Stimulus Package Temporary

On a recent official visit to China, Canadian Prime Minister Stephen Harper took the opportunity to use a press conference as a venue for giving a Canadian economic update and to send messages home about the Canadian government's stimulus package.

The timing of the report may have seemed slightly peculiar but a portion of the diplomatic visit was dedicated to promoting Canadian business, investments and trade with China. Harper hopes that this trip will improve and expand business opportunities with China. Canada's relationship with China is the country's second largest, aside from the U.S. Bilateral merchandise trade with China tops $53 billion a year, although China exports four times as much as it imports from Canada. China has lifted a ban on pork import from Canada, a $50 million potential market, but this is still far from an equal balance.

Mr. Harper sent a message home that the government's stimulus program has given a jump-start to the economy but Canadians should be aware that it is a temporary program. The government has warned that stimulus funds must be spent by March 2011 or will be lost. Government officials are quick to point out that termination of the stimulus funds will allow the current projected deficit of $57 billion to be cut in half. Opponents of the government, though, point out that trimming the deficit is not the only issue at hand.

The stimulus package was designed to help a recession struck nation by providing employment for Canadians. Critics note that the Harper government has not released figures on how many jobs were created through the stimulus programs. Furthermore, Statistics Canada announced that the economy had grown by only 0.4 per cent in the third quarter, a rate slower than most of the Group of Seven countries.

Mr. Harper paints a picture of cautious optimism yet it remains unclear whether Ottawa has indeed managed to invigorate an ailing economy.

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