Canada's economy at risk if Europe doesn't step up: Flaherty
Canada's Finance Minister Jim Flaherty leaves following a news conference in Ottawa August 15, 2012. REUTERS/Chris Wattie
OTTAWA - Worried that all the hard work Canadians did to keep their economy afloat during the recession is at risk of being swamped by sinking European economies, Finance Minster Jim Flaherty called on overseas leaders to step up and plug their fiscal holes.
Flaherty was speaking to reporters ahead of his annual "policy retreat" - a day-and-a-half off-the-record gabfest with about 20 CEOs and academics (one union leader from the AFL-CIO was invited) - but his comments also came just hours before German Chancellor Angela Merkel was to land in the nation's capital for talks with Prime Minister Stephen Harper.
Merkel and other European leaders have been pushing Canada to pitch in to a special multibillion-dollar fund that could be used to prop up the finances of some flailing Eurozone countries like Spain and Portugal.
If Merkel asks Harper for help, Flaherty said, she'd better be prepared to be disappointed.
"We have been clear for several years that not only should the European countries take overwhelming concerted action to take control of this situation but also that the European countries themselves have more than adequate resources to do so. So, no, it's not necessary for Canada to use Canadian resources to help solve the European problem given that the European countries are among the wealthiest in the world," Flaherty said. "They need to do much more."
Flaherty boasted that his government's response to the recession worked like a charm, and he cited the fact that 750,000 net new jobs have been created in Canada since July 2009 - the best job creation record in the G7.
He also trotted out some other economic data that showed our economy had largely recovered from the depths of the 2008-2009 crisis.
Still, since Canada's prosperity depends heavily on international trade, Flaherty recognizes the risk to Canada if Europe and other regions don't get their act together.
"The global economy remains stubbornly fragile," Flaherty said. "Continuing economic headwinds from outside the country could easily throw us off course."