OPTIONS POLITIQUES APRIL 2012 6 “The wealth of Western economies is no more inevitable than the poverty of emerging ones” I will use my time today to high- light Canada’s economic strengths and to frame the choices we face as we work to secure long-term pros- perity for our citizens in a difficult global environment, one that is likely to remain so. As you know, Canada has eco- nomically outperformed most indus- trialized countries during these recent difficult years for the global economy. Forbes magazine ranks Canada as the best place on the planet for business- es to grow and create jobs. The OECD (Organisation for Economic Co-oper- ation and Development) and the IMF (International Monetary Fund) pre- dict our economy will again be among the leaders of the industrial- ized world over the next two years. And one more cherished accolade, of course, is that for the fourth year in a row, this body, the World Economic Forum, says our banks are the soundest in the world. These evaluations are the result of sound fundamentals. Among G7 coun- tries, Canada has the lowest overall tax rate on new business investment. Our net debt-to-GDP ratio remains the low- est in the G7 — and by far. And while we remain concerned about the number of Canadians who are still out of work, Canada is one of only two G7 countries to have recouped all of the jobs lost during the global recession. Indeed, more Canadians are now working than before the downturn. How was this achieved? Faced with the worst global eco- nomic crisis since the 1930s, our gov- ernment implemented some of the most extensive and targeted economic stimulus measures of the G20. W e made historic investments in infrastructure. We encouraged businesses to invest and helped them to avoid layoffs. We put substantial funding into skills training, and we extended support for workers who lost their jobs. These things we did on a timely, targeted and temporary basis. We did not create permanent new programs or government bureaucracy. As a conse- quence, our deficit is now falling, our debt-to-GDP ratio has already peaked and we do not need to raise taxes. I should add that we also did not reduce immigration or give in to protectionism. Instead, we have maintained the high levels of immigration that our aging labour force of the future will require. We have continued to pur- sue new trade agreements. And we have taken action to make Canada, among G20 countries, the first tariff-free zone for manufacturers. We have pursued these policies, ladies and gentlemen, because our number- one priority as a government is pros- perity, that is, economic growth and job creation. Now that may sound obvious, almost clichéd. But is it really? As I look around the world, as I look particularly at developed countries, I ask whether the creation of economic growth, and therefore jobs, really is the number-one policy priority everywhere. Or is it the case that in the devel- oped world too many of us have, in fact, become complacent about our prosperity, taking our wealth as a given, assuming it is somehow the nat- ural order of things, leaving us instead to focus primarily on our services and entitlements? Is it a coincidence that as the veil falls on the financial crisis, it reveals not just too much bank debt, but too VERBATIM Stephen Harper In a keynote address at the Davos Conference hosted by the World Economic Forum, the Prime Minister reviewed some of Canada’s achievements coming out of the global financial crisis, and looked down the road to some of the demographic and economic challenges that lie ahead for all Western and developing economies. Dans son discours prononcé au Forum économique mondial de Davos, le premier ministre du Canada a fait valoir certaines des réalisations de notre pays au sortir de la crise financière mondiale et a évoqué quelques-uns des enjeux économiques et démographiques qui attendent tous les pays occidentaux et en développement.
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OPTIONS POLITIQUESAPRIL 2012
6
“The wealth of Western economies is nomore inevitable than the poverty ofemerging ones”
I will use my time today to high-light Canada’s economic strengthsand to frame the choices we face
as we work to secure long-term pros-perity for our citizens in a difficultglobal environment, one that is likelyto remain so.
As you know, Canada has eco-nomically outperformed most indus-trialized countries during these recentdifficult years for the global economy.Forbes magazine ranks Canada as thebest place on the planet for business-es to grow and create jobs. The OECD(Organisation for Economic Co-oper-ation and Development) and the IMF(International Monetary Fund) pre-dict our economy will again beamong the leaders of the industrial-ized world over the next two years.
And one more cherished accolade,of course, is that for the fourth year ina row, this body, the World EconomicForum, says our banks are the soundestin the world.
These evaluations are the result ofsound fundamentals. Among G7 coun-tries, Canada has the lowest overall taxrate on new business investment. Ournet debt-to-GDP ratio remains the low-est in the G7 — and by far.
And while we remain concernedabout the number of Canadians whoare still out of work, Canada is one ofonly two G7 countries to haverecouped all of the jobs lost during theglobal recession.
Indeed, more Canadians are nowworking than before the downturn.How was this achieved?
Faced with the worst global eco-nomic crisis since the 1930s, our gov-ernment implemented some of themost extensive and targeted economicstimulus measures of the G20.
W e made historic investments ininfrastructure. We encouraged
businesses to invest and helped themto avoid layoffs. We put substantialfunding into skills training, and weextended support for workers who losttheir jobs.
These things we did on a timely,targeted and temporary basis. We didnot create permanent new programs orgovernment bureaucracy. As a conse-quence, our deficit is now falling, ourdebt-to-GDP ratio has already peakedand we do not need to raise taxes. Ishould add that we also did not reduceimmigration or give in to protectionism.
Instead, we have maintained thehigh levels of immigration that ouraging labour force of the future willrequire. We have continued to pur-sue new trade agreements.
And we have taken action to makeCanada, among G20 countries, thefirst tariff-free zone for manufacturers.We have pursued these policies, ladiesand gentlemen, because our number-one priority as a government is pros-perity, that is, economic growth andjob creation.
Now that may sound obvious,almost clichéd. But is it really? As I lookaround the world, as I look particularlyat developed countries, I ask whetherthe creation of economic growth, andtherefore jobs, really is the number-onepolicy priority everywhere.
Or is it the case that in the devel-oped world too many of us have, infact, become complacent about ourprosperity, taking our wealth as agiven, assuming it is somehow the nat-ural order of things, leaving us insteadto focus primarily on our services andentitlements?
Is it a coincidence that as the veilfalls on the financial crisis, it revealsnot just too much bank debt, but too
VERBATIM Stephen Harper
In a keynote address at the Davos Conference hosted by the World EconomicForum, the Prime Minister reviewed some of Canada’s achievements coming outof the global financial crisis, and looked down the road to some of thedemographic and economic challenges that lie ahead for all Western anddeveloping economies.
Dans son discours prononcé au Forum économique mondial de Davos, lepremier ministre du Canada a fait valoir certaines des réalisations de notre paysau sortir de la crise financière mondiale et a évoqué quelques-uns des enjeuxéconomiques et démographiques qui attendent tous les pays occidentaux et endéveloppement.
much sovereign debt, too much gen-eral willingness to have standardsand benefits beyond our ability oreven willingness to pay for them?
I don’t know. But what I do knowis this. First, that the wealth of Westerneconomies is no more inevitable thanis the poverty of emerging ones, andthat the wealth we enjoy today hasbeen based on — and only on — the
good, growth-oriented policies; theright, often tough choices; and thehard work done in the past.
And second, that regardless ofwhat direction other Western nationsmay choose, under our government,Canada will make the transformationsnecessary to sustain economic growth,job creation and prosperity, now andfor the next generation.
That further means two things:making better economic choices nowand preparing ourselves now for thedemographic pressures the Canadianeconomy faces.
On what we must do now, first, wewill, of course, continue to keep taxrates down. That is central to our gov-ernment’s economic vision. But wewill do more, much more. In the
POLICY OPTIONSAPRIL 2012
7
VERBATIM“The wealth of Western economies is no more inevitable than the poverty of emerging ones”
Prime Minister Harper speaking to the Davos Conference on January 26. Canada’s choice, he said, “with clarity and urgency, is to seizeand to master our future.”
PMO photo
months to come our government willundertake major transformations toposition Canada for growth over thenext generation.
For example, we will continue tomake the key investments in science
and technology necessary to sustain amodern competitive economy. But webelieve that Canada’s less than optimalresults for those investments is a sig-nificant problem for our country.
We have recently received a report— the Jenkins Report — on this, andwe will soon act on the problems thereport identifies.
We will continue to advance ourtrade linkages. We will pass agree-ments signed, particularly in our ownhemisphere, and we will work to con-clude major deals beyond it.
W e expect to completenegotiations on a
Canada-EU free trade agree-ment this year. We will work tocomplete negotiations on a freetrade agreement with India in2013. And we will begin entrytalks with the Trans-PacificPartnership, while also pursuing otheravenues to advance our trade withAsia. Of course, I will again be makingan official visit to China very shortly.
We will also continue workingwith the Obama administration toimplement our joint Beyond theBorder initiative — our plan tostrengthen and deepen our economicand security links with our mostimportant partner.
However, at the same time, we willmake it a national priority to ensurewe have the capacity to export ourenergy products beyond the UnitedStates, and specifically to Asia. In thisregard, we will soon take action toensure that major energy and mining
projects are not subject to unnecessaryregulatory delays — that is, delaymerely for the sake of delay.
This complements work we arealready doing and that we will move for-ward on with the Canadian Federation of
Independent Business to cut the burdenof red tape on entrepreneurs.
We will also undertake significantreform of our immigration system. Wewill ensure that, while we respect ourhumanitarian obligations and familyreunification objectives, we will makeour economic and labour force needsthe central goal of our immigrationefforts in the future.
As I said earlier, one of the back-drops for my concerns is Canada’saging population. If not addressedpromptly, this issue has the capacity toundermine Canada’s economic posi-
tion and, for that matter, the positionsof all Western nations, well beyond thecurrent economic crises.
Immigration does help us addressthe issue of the aging population andwill even more so in the future. Ourdemographics also constitute a threatto the social programs and servicesthat Canadians cherish. For this rea-son, we will be taking measures in thecoming months just to not return to abalanced budget in the medium term,but also to ensure the sustainability ofour social programs and fiscal positionover the next generation.
W e have already taken steps tolimit the growth of our health
care spending over that period. Wemust do the same for our retirementincome system. Fortunately, the centre-piece of that system, the CanadaPension Plan, is fully funded, actuarial-ly sound and does not need to be
changed. For those ele-ments of the system that arenot funded, we will makethe changes necessary toensure sustainability for thenext generation, while notaffecting current recipients.
Let me summarize bysaying, ladies and gentlemen, that,notwithstanding Canada’s manyadvantages, we remain very concernedabout the continuing instability of theglobal economy, of which we are apart. The problems afflicting Europe,and for that matter the United States,are not only challenging today but, inmy judgment, threaten to be evengreater problems in the future.
Having said that, each nation hasa choice to make. Western nations, inparticular, face the choice of whetherto create the conditions for growthand prosperity or to risk long-term
economic decline. In every decision,or failure to decide, we are choosingour future right now.
And as we all know, both from theglobal crises of the past few years andfrom past experience in our own coun-tries, easy choices now mean fewerchoices later.
Canada’s choice will be, with clar-ity and urgency, to seize and to masterour future, to be a model of confi-dence, growth and prosperity in the21st century.
Stephen Harper is Prime Minister ofCanada. Excerpted from a speech to theWorld Economic Forum at Davos,Switzerland, on January 26, 2012.
OPTIONS POLITIQUESAPRIL 2012
8
VERBATIMStephen Harper
Is it the case that in the developed world too many of ushave, in fact, become complacent about our prosperity,taking our wealth as a given, assuming it is somehow thenatural order of things, leaving us instead to focus primarilyon our services and entitlements?
The wealth of Western economies is no more inevitable thanis the poverty of emerging ones, and that the wealth weenjoy today has been based on — and only on — the good,growth-oriented policies; the right, often tough choices; andthe hard work done in the past.
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