Harper vows to do what it takes to combat crisis

Fri Nov 21, 2008 7:37am EST
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By David Ljunggren

OTTAWA (Reuters) - Canada will take whatever fiscal and monetary measures are needed to combat the effects of the global financial crisis, Prime Minister Stephen Harper said on Thursday, predicting more economic gloom to come.

Harper also told Parliament that the Conservative government would not balance the budget by raising taxes or cutting essential services in a time of upheaval.

"World governments have resolved that they will undertake whatever financial, monetary and budgetary measures are necessary to cope with the crisis, and let me be clear -- this is also the position of the government of Canada," he said.

Harper, whose Conservatives won a strengthened minority in the October 14 election, also promised short-term stimulus for the economy.

"We have been affected and we will be further affected, particularly given that our closest neighbor and largest trading partner is the epicenter of the financial earthquake and global slowdown," he said.

The United States buys more than 75 percent of all Canada's exports and the slowdown south of the border is hitting Canadian manufacturers particularly hard. The two countries share the world's largest trading relationship.

Finance Minister Jim Flaherty said Ottawa may consider providing economic stimulus through additional investments in infrastructure projects. That would be on top of C$16 billion in spending already pledged in the last budget and which Flaherty hopes to disburse more quickly than initially planned.

"Will we do more? It's possible we will do more.... All suggestions with respect to stimulating the economy are welcome. The main thing is to get the money out the door," he told reporters.   Continued...

<p>Prime Minister Stephen Harper speaks during Question Period in the House of Commons on Parliament Hill in Ottawa November 20, 2008. REUTERS/Chris Wattie</p>