The president of the Business Council of Canada (BCC) says the business community’s confidence in the health of Canada’s finances is “eroding” and suggests federal finances are “largely manipulated.” .
“What we’re hearing from business leaders across the country is that the math doesn’t add up and there are consequences,” Goldie Heider told CBC. the house Days before the Minister of Finance gave her a presentation. Autumn economic updates.
“When you lose confidence that this country’s finances are literally being manipulated to tell a story that is not accurate, that has as much effect as telling business leaders, ‘Don’t invest now.’ ” he told the host. Katherine Cullen.
Hyder pointed to Ottawa. Capital gains tax changes and thoughts on what to do with the surplus money federal civil servant pension The plan shows that they are keen to find new sources of income.
“It’s like governments looking under the couch cushions for money to feed their spending habits,” Haider said.
There is speculation that the federal government may not be able to meet the $40.1 billion budget deficit goal that Freeland set last year. On Tuesday, the Minister of Finance did not commit To achieve that goal.
Instead, Freeland said he expects the fall economic report to be released on Monday to show a decline in the debt-to-GDP ratio.
Haider said the business community doesn’t have confidence in the federal government’s forecast because “the anchor is different today.” [what] It was there before. ”
“What we’re seeing here is governments not inspiring confidence in investment, governments not inspiring confidence in markets when the economy is down,” he said. Ta.
In late November, Statistics Canada reported: Canada’s economy has grown The third quarter also saw increases in government and household spending, at an annual rate of 1%.
Armin Yarnizian, an economist and Atkinson fellow on the future of workers, said the deficit is less important than the government’s debt-to-GDP ratio.
CBC’s Janice McGregor explains what to expect in next week’s fall economic report, the latest from Finance Minister Chrystia Freeland, who declined to comment Tuesday on the size of the projected deficit. Verify.
Yarnizyan also pointed to the interest the federal government must pay on the debt. last year, federal debt contribution It reached 1.3% of GDP, one of the lowest figures since 1966, according to the federal government. accounting reference table.
“I know there are political parties who would like us to borrow no money at all,” she said. “It’s not possible, but sometimes that can be the miracle number they’re trying to achieve.”
Yarnizian also said Canadians “need to choose a lane. They either want service or they want lower taxes.”
President Trump’s tariff threat looms
Canadian businesses, provincial and federal governments are bracing for U.S. President-elect Donald Trump to follow through on his slap threat. 25% customs duty Applies to all imports from Canada and Mexico.
Yarnizyan said President Trump’s style is to “create uncertainty and put people at a disadvantage” because governments don’t know how substantively they should respond or if they should respond at all. said.
“So there’s an advantage to avoiding tariffs without actually imposing them. There’s what people call pre-submission,” Yarnizian said.
President Trump also criticized the United States. Trade deficit between Canada and Mexicodescribes them as subsidies.
Yarnizian said the nature of trade means there will never be a perfect balance between Canada and the United States.
“So we’ll never be able to appease him… unless we’re always buying more from the US than we’re buying from the US. And maybe that’s the strategy,” she said. said.
Haider said President Trump’s tariff threats are a tactic to encourage capital investment in the United States. He said Canada needs to be “smart” and consult with Canadian businesses on how to tackle this issue.
