UPDATE 1-Canada's Morneau: economic figures reinforce need for investments

Fri Dec 4, 2015 6:11pm EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

(Adds background, details on tax measure)

OTTAWA Dec 4 (Reuters) - Disappointing Canadian economic figures reinforce the need for significant government investments to boost growth, Canada's new finance minister said on Friday after the release of weak jobs and trade data.

The Liberals campaigned on a platform to run budget deficits of up to C$10 billion ($7.49 billion) a year in order to spend on infrastructure to boost growth after the economy was in a modest recession in the first half of the year.

Although growth resumed in the third quarter, the final quarter of the year has gotten off to a weak start, illustrated by Friday's underwhelming jobs and exports data.

"We heard today some statistics that reinforced our concerns around the growth of the economy," Canada's Finance Minister Bill Morneau told reporters.

"Our reaction is that we need to deal with the challenges that we're faced with. It reinforces for me the need to make significant investments in the economy, as we presented to Canadians in our campaign," he said.

Morneau spoke after Canada's recently elected Liberal government unveiled its plans at the start of the new Parliament, promising to pursue a fiscal plan "that is responsible, transparent and suited to challenging economic times."

The government plans to introduce a motion to lawmakers on Wednesday to bring in a promised tax cut for the middle class and a tax increase for higher income earners starting in 2016.

Asked about reports that hiking tax rates on the rich would not bring in as much money as forecast, Morneau said, "I'll be next week providing people with a clearer picture of what exactly our tax cuts will mean for Canada ... and also the costs that we'll incur by doing it." ($1 = 1.3357 Canadian dollars) (Reporting by David Ljunggren, writing by Leah Schnurr; Editing by Diane Craft)