(OTTAWA) – July 8, 2020 – The Canadian Chamber of Commerce’s President and CEO, Perrin Beatty, released the following statement today in response to the government’s economic snapshot.
“Today’s economic statement projected a deficit of 343 billion dollars with a debt-to-GDP ratio of 49.1%, a sum that will undermine Canada’s fiscal capacity for decades.
The lockdowns were an appropriate response to a threat that no-one fully understood at the time, and the government’s crisis response provided urgently-needed assistance to Canadian workers and businesses, so they could be there to propel our economic recovery.
But as today’s snapshot demonstrates, these measures have come at an enormous price – one that far exceeds even the most pessimistic estimates – and their cost will continue to mount throughout the coming year and beyond. Declining government revenues mean that the burden will be borne by an economic infrastructure that has been badly damaged.
It is now time for Canada to transition from a subsidy-based crisis response toward restoring economic growth and getting Canadians safely back to work. With much less fiscal breathing room and fewer financial tools available to us, we must focus on the economic fundamentals.
Today our net national debt is 768 billion dollars, and will reach 1 trillion dollars this year. If provincial and municipal debt is included, the situation is far more precarious. Because the federal government is the de facto backstop for these liabilities, Canada will face much closer scrutiny from investors, given our diminished ability to manage our fiscal affairs. We simply cannot afford to return to the pre-COVID policy agenda.
Canada needs a clear plan to restore private sector growth, starting with a tailored strategy and a timetable for safely reopening that will allow businesses and families alike to plan. We need a longer-term fiscal plan and forward guidance from the government. Today should have been an opportunity to offer Canadians a clear picture of the challenges and a coherent strategy to address them. What businesses, investors, analysts and Canadians alike wanted to hear was how we will move away from the short-term measures that are quickly draining the federal treasury to helping families and businesses once again become self-sufficient.
Recovery must start along the Main Streets of this country. The Canadian Chamber has proposed a 51-point Roadmap to Recovery. We ask governments to focus on growth with the same energy and commitment that they directed toward lockdowns and subsidies.”
About the Canadian Chamber of Commerce – Because Business Matters
The Canadian Chamber of Commerce helps build the businesses that support our families, our communities and our country. We do this by influencing government policy, by providing essential business services and by connecting businesses to information they can use, to opportunities for growth and to a network of local chambers, businesses, decision-makers and peers from across the country, in every sector of the economy and at all levels of government, as well as internationally. We are unapologetic in our support for business and the vital role it plays in building and sustaining our great nation.
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