Mr. Day told U.S. Trade Representative Ron Kirk that Ottawa’s talks with the provinces
are in their final stages. The idea is to let firms from both sides of
the border bid on provincial, state and city contracts, and not just
federal jobs.

Meeting at an Asia-Pacific session in Singapore, Mr. Day also told Kirk that Canada was assessing the impact
of U.S. country-of-origin meat labelling rules and could move to the next stage of challenging them at the World Trade Organization.

There is growing consensus that a global economic recovery is in the making, albeit the pace will be tepid and restrained. Momentum should, however, build through 2010 and 2011.

The question we should start asking is, ‘What comes next?’ In part this will depend upon the skill and will of central bankers. They will need to withdraw their unprecedented monetary stimulus with surgical precision– not so quickly as to jeopardize recovery but not so slowly as to stoke the inflation fire.

But the world economy will still be a dangerous place. In the name of mitigating the downturn, the U. S. federal government will go from around a 40% debt-to-GDP ratio to 100% within a few years and many states are racking up large fiscal shortfalls as well. The United States will not likely deal with this exploding debt very well. They will find it difficult to cut spending or raise taxes sufficiently. Even if financial sector regulations are improved around the world, this type of imbalance could provoke the next economic cycle. And even if another crisis is avoided, the United States will be exporting to the world lower growth, a depreciating dollar and premiums on bond yields as the inexhaustible supply of debt floods the global markets.

More.. ]]> http://www.invest-in-canada.com/news/what-comes-after-the-great-recession.htm/feed 0 http://www.invest-in-canada.com/news/flaherty-sees-us-deficit-as-biggest-threat-to-recovery.htm http://www.invest-in-canada.com/news/flaherty-sees-us-deficit-as-biggest-threat-to-recovery.htm#comments Mon, 15 Jun 2009 04:04:20 +0000 investor http://www.invest-in-canada.com/?p=308 The biggest risk to Canada’s economic recovery is not the rising dollar or climbing oil prices, but the burgeoning U.S. deficit, Finance Minister Jim Flaherty said at the close of the Group of Eight finance ministers meeting.

Although Canada is showing signs of renewed economic life and better consumer confidence, Mr. Flaherty said “I worry about the slowness of the recovery in the U.S. I worry about the size of the U.S. deficit, which is approaching US$2-trillion this year.”

His comments came as the statement issued by the G8 finance ministers, meeting in the baroque city of Lecce in the heel of Italy, noted “signs of stabilization in our economies, including a recovery of stock markets, a decline of interest rate spreads, improved business and consumer confidence.”

But they warned that the “significant risks remain” and urged the G8 countries not to abandon their economic overhaul packages, such as stimulus spending, to secure the recovery.

The finance ministers of the world’s eight largest economies said they were generally more bullish about widespread recovery than they were even a few months ago, as stimulus spending kicks in, though they warned that unemployment could still climb because of the lag effect. “All of us believe we are right to confident, that we will get through the global recession,” Alistair Darling, the British chancellor, told reporters. “But we are right to be cautious…We are mindful that we live in an uncertain world.”

Mr. Flaherty said he fears that any failure to rein in the U.S. deficit could trigger a credit downgrade, which in turn would force interest rates up and delay both the American and Canadian recoveries. Earlier this month, Ireland received a fresh blow to its economy and its image when Standard & Poor’s cut the rating on the country’s sovereign debt for the second time in three months.

More..

The reforms promised by president-elect Barack Obama would offer insurance to 45 million U. S. residents who have no coverage. The resulting surge in demand for doctors’ services is likely to trigger a drain on Canada’s already meagre supply of physicians, some analysts say. Primary-care specialists, including family doctors, internists and pediatricians, will be in most demand if the changes come about, as looks increasingly likely.

Until U. S. medical schools start turning out larger numbers of doctors, the United States will likely look outside its borders to help fill the gap. The United States may use new incentives to lure physicians into those generalist roles.

“If, relative to the U. S., your primary care is undervalued, that is going to be a real issue for Canada,” said Dr. Fred Ralston of the American College of Physicians, which represents internal-medicine specialists. “If you don’t make parallel moves, that could really cause problems.”

Even now, physicians earn more on average in the United States than in Canada.

More..