Our economy is off to a terrible start to 2020 as four years of government policy are making their presence felt
Experts point to dwindling manufacturing sales, which have posted their fourth consecutive negative reading, stagnant retail sales and signs are that Gross Domestic Product growth is stalling and may actually be negative when accounted for on a per-capita basis.
Moreover, analysts opine, concerns about the coronavirus and its global economic impact couldn’t come at a worse time.
One columnist points to one problem, that the Prime Minister's Office has for the most part appeared more concerned with other issues, such as securing a United Nations Security Council seat, than it has on ensuring the economy stays on track.
Instead of nipping anti-pipeline blockades in the bud, they were allowed to rapidly expand and paralyze both the country’s economy and our reputation globally as a secure place to do business. Grain shipments have been halted costing hundreds of millions in lost sales, thousands of rail jobs have been temporarily lost and the lack of propane shipments to the Atlantic provinces have left inventory levels dangerously low.
The same message was sent this weekend when Teck Resources Ltd. (T.TECK.B) announced it had decided to cancel its $20-billion Frontier oilsands mine citing worries over Canada’s inability to create a framework that “reconciles resource development and climate change.”
Frontier isn’t an isolated incident: It now joins the $100 billion of resource projects that were scrapped from 2017 to 2019, according to the C.D. Howe Institute.
"For those who say that ramped-up fiscal spending by the Federal Government will help offset some of the damage," writes one analyst, "don’t forget that Ottawa hiked higher personal tax rates and attacked small business in a bid to raise revenues to cover some of that spending while concurrently having to deal with debt servicing costs.
"In the end," he writes, "we think it will be left up to the Bank of Canada to deal with this mess. This means they may finally have to give up the hallowed ground they have defended for so long and implement an emergency interest rate cut. With oil prices in the toilet, they may be removing a key support for the Canadian dollar."
