Canada’s Exports Need to Be Reoriented to the New Global Economy, Says Bank of Canada Governor Mark Carney
(Bank of Canada)
In response to the global financial crisis, Canada’s broad economic strategy has been to grow domestic demand and to encourage Canadian businesses to retool and reorient to the new global economy, Bank of Canada Governor Mark Carney said in a speech today. “On the former, we have been successful,” he noted. On the second, he urged greater focus.
“As effective as the reliance on domestic demand in general and household spending in particular has been, the limits of this growth model are becoming clear,” the Governor told business and community leaders in the Kitchener-Waterloo region.
While household spending in Canada has been growing strongly for over a decade, it has become more heavily dependent on stimulative financing conditions and high levels of net worth since the crisis. As a consequence, the debt burden on Canadian households has increased further, and much of the financing for the recent increases in indebtedness has come from abroad. “These trends are unsustainable over the medium term,” the Governor said. Read more here.
Date: April 4, 2012