"None of the roots of the recession are to be found in Canada, and Canada, while it has been significantly impacted, is emerging from the global recession in a strong position. Despite the turbulence of recent months, Canadian banks are secure, our markets are expanding, our stimulus is working, our taxes are falling, our long-term fiscal position is solid, and our broader economic assets remain intact. If we stay the course, Canada's future has never looked so bright."
-Stephen Harper (speaking on Canada's position in the global recession)
So, how is it that we came out of the recession relatively strong compared to other countries?
Canada was the LAST major industrialized country dragged into the global recession. Before the recession began to have its effects Canada had:
- An expanding economy
- Low unemployment rates
- Net job creation
- Government surpluses before entering recession- by the end of the recession, Canada's deficit was one of the smallest in the developed world
Why Canada wasn't as negatively impacted as other developed countries:
- Avoided excesses (e.g. housing bubbles, consumer and financial sectors)
- Strong financial sectors and banks (financial regulatory system)- Canadian banks avoided subprime mortgages and mortgage backed securities, unlike US banks
- Commitment to free trade and open markets- In response to the economic crisis and its effects on trade and the rise of protectionist forces, Canada redoubled our efforts to keep trade flowing and pursued new free trade agreements
- Effective implementation of stimulus measures-In beginning of recession, government cut taxes aggressively while maintaining a balanced budget.
All these reasons contributed to helping delay Canada's domestic economy from entering recession for a significant amount of time.
