Canada economy to rebound this year after energy slump: minister

Sat Jul 23, 2016 11:17am EDT
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TORONTO, July 23 (Reuters) - Canada's economy should rebound "over the course of the year" from the impact of a wildfire in its energy heartland, Finance Minister Bill Morneau said on Saturday on the sidelines of a G20 meeting in Chengdu, China.

The fire in the province of Alberta is estimated to have cut daily oil production by more than 1 million barrels and the Bank of Canada estimates it will shave 1.25 percentage points off economic growth in the second quarter.

"We were approximately right in our expectations in our budget," he said of Canada's fiscal plan introduced in March, which promised growth spurred by government spending.

Speaking to reporters by telephone, Morneau said Canadian growth was also challenged by global uncertainty following Britain's vote last month to exit the European Union, but that was offset by the strong U.S. economy.

Morneau also said Canada wants a separate trade deal with Britain.

Canada is finalising a free trade agreement with the EU, which negotiates on behalf of member states. Britain's decision to leave the bloc means it has to eventually forge such deals on its own.

"We seek the opportunity to develop a strong trade agreement with the United Kingdom, and that's something that I know my colleague (International Trade Minister) Chrystia Freeland will be working on," Morneau said. (Reporting by Ethan Lou in Toronto; Editing by Tom Heneghan)