Can Canada regain economic superstar status?
- June 16, 2013
by Mary Scianna
When the International Monetary Fund cut its 2013 Canadian growth forecast to 1.5 per cent in April from an October
2012 estimate of 2 per cent, Canada abruptly fell to last place among the Group of 20 countries outside Europe for economic growth.
The IMF report sees few improvements for Canada’s economy in the next two
years and notes that “other advanced countries” not in the G7 group, such as Australia and New Zealand, are projected to outperform Canada.
Canada may not regain economic superstar status for several years, but do we need superstar status to grow?
Forecasts such as IMF’s are like large seismic earthquakes that generate tremors far and wide and send people running, fearful of getting caught in them. In industry, it leads to cancellation of orders, pull-backs in expansion plans or in hiring of people.
In spite of the rather bleak forecast, we should keep two things in mind. It is just a forecast, although arguably an influential one based on economic indicators, and the slowdown in growth is part of an economic pendulum that will swing back.
Indeed, it was just in January that Statistics Canada reported manufacturing had helped to drive the Canadian economy’s return to a better than expected growth, with the country’s GDP growth of 0.2 per cent in December beating a predicted 0.1 per cent.
It is a slowdown in economic growth, not a shutdown. Even in the worst economic period there are businesses and people who find innovative opportunities to grow.
I’m not suggesting that the downgraded IMF forecast is not relevant. What I am suggesting is that business must and does go on. Demand for goods–cars, airplanes, household goods–does not stop, it slows down, and someone still needs to manufacture products to meet those demands.
One good thing that has come out of the past several years of economic upheaval is that manufacturing businesses that have survived have learned to ride the economic waves and some have continued to experience growth in spite of the troubled economy.
Sometimes, German philosopher Friedrich Nietzsche’s saying “that which does not kill us makes us stronger” really does hold true. SMT