Finance Minister Francois-Philippe Champagne will release a mini-budget outlining the country’s finances on April 28. The government has estimated a $65.4 billion deficit for the current fiscal year, as Carney aims to spend heavily on defence and infrastructure while cutting taxes. In the November budget, the government said the outlays would push its net debt-to-gross domestic product ratio to 43 per cent.
By that metric, Canada has a stronger financial position than other G7 countries, many of which carry net debt levels near or above 100 per cent of the size of their economies. That dynamic has at times led economists to describe Canada as simply the “cleanest dirty shirt.”
Still, Chalk reiterated the IMF’s view that the northern nation has room to spend more to boost the productive capacity of the economy and to build out infrastructure that supports the growth of its energy sector and other strategic industries.
The comments contrast with some domestic views of the Carney government’s fiscal trajectory. Champagne dropped the previous administration’s pledge to maintain a falling net debt-to-GDP ratio, sparking criticism from a parliamentary budget watchdog. Conservative Leader Pierre Poilievre has also accused the government of fueling inflation through its deficits.
Source: https://financialpost.com
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