With Canada’s economy facing a harder uphill climb than even three months ago, it makes sense to enforce additional and immediate traction in light of the slipping loonie, shaky stock market, skidding oil prices, and a worrying downturn in the value of other commodities.
The Liberal government is considering speeding up its promised spending on infrastructure projects. Greater investment in infrastructure could provide the push that Canada needs to power through hard times.
Still struggling to cope with a steady erosion of manufacturing jobs in Ontario, Canada’s economy has seen oil prices plunge lower than they’ve been in more than a decade. While this has been especially damaging for Alberta, the effects are slowly spreading across the country.
Other commodities have also lost value driving down the loonie. It sank below 69 cents U.S. recently for the first time since 2003. The stock market is stumbling as well.
The economic turmoil in China is the reason behind the downturn as China is a huge market for Canada’s raw materials. That instability is unlikely to end anytime soon. Federal officials can, however, do more to stimulate economic activity and job creation. That’s where judicious use of infrastructure spending could be particularly useful.
The Liberal government plans to spend about $60 billion on infrastructure projects over the coming decade. But only about $17.4 billion of that, not even one-third, is planned for the next four years. And stimulus is needed now.
According to The Canadian Press, Prime Minister Justin Trudeau’s government is looking at advancing its original spending schedule, given the worsening economic outlook.
There’s certainly no shortage of projects that deserve support. Public transit expansion, increase in affordable housing and additional seniors’ facilities are especially required. Also needing support are municipalities of all sizes that are desperate to fix their cracked roads, crumbling sewers, rusting bridges and aging water treatment plants.
Public Safety Minister Ralph Goodale said that a portion of planned infrastructure spending is slated for disaster readiness, helping communities blunt the impact of catastrophes such as floods, ice storms, high winds and forest fires. As well as stimulating the economy and providing jobs, such projects carry the added benefit of mitigating future costs.
Given all this pent-up need, there should be projects on the books that could be quickly launched as soon as money is available. These should be a priority in such difficult economic times.
While there’s nothing wrong with long-term infrastructure spending, Canada’s economy needs an immediate lift.
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