Flaherty sees economic growth ahead

Fri Aug 29, 2008 9:36am EDT
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TORONTO (Reuters) - Canada's economy should achieve growth of about 1 percent this year as higher incomes and job creation support activity, Finance Minister Jim Flaherty said.

"As expected, the pace of economic activity remains slow as a result of the U.S. slowdown and its impact on our export sector," he told reporters on Friday.

"For 2008 as a whole, I expect real GDP to increase by about 1 percent," he said.

"Solid growth in income and employment in the second quarter should help support economic activity going forward."

Canada's economy grew by a weaker-than-expected 0.3 percent in the second quarter, Statistics Canada reported, narrowly avoiding the common definition of a recession.

GDP shrank 0.8 percent in the first quarter.

(Reporting by John McCrank; Writing by Ka Yan Ng; Editing by Ted Kerr)

<p>Finance Minister Jim Flaherty listens to a question while speaking to journalists in the foyer of the House of Commons on Parliament Hill in Ottawa June 5, 2008. REUTERS/Chris Wattie</p>