Canada says will spend bulk of stimulus fast

Tue Mar 10, 2009 5:03pm EDT
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By David Ljunggren

OTTAWA (Reuters) - Canada will start pouring C$20 billion ($16 billion) of stimulus spending into the economy on April 1 as part of its plan to fight off the global financial crisis, Prime Minister Stephen Harper said in an upbeat speech on Tuesday.

Harper, whose minority Conservative government plans to spend C$40 billion in stimulus over the next two fiscal years, said his officials have slashed red tape to ensure the money can be spent quickly.

"As a result, by April 1, the government will be able to start pumping C$20 billion directly into the economy, representing close to 90 percent of the stimulus for this fiscal year," he said in a speech in Brampton, Ontario.

Harper said the government would make most of the stimulus funding available on April 1, and said the rest would be available within five months.

The spending will rack up C$64 billion in federal government budget deficits over the next two fiscal years. Harper repeated his line that the deficits would be temporary.

The prime minister, criticized for mishandling the economic downturn, said the government's actions would ensure that Canada emerges from the crisis in the best position of any advanced nation.

"We will not turn the corner on this global recession until the American financial sector is fixed," he said.

"Canada was the last advanced country to fall into this recession. We will make sure its effects here are the least severe and we will come out of this faster than anyone and stronger than ever."   Continued...

<p>Prime Minister Stephen Harper speaks during Question Period in the House of Commons on Parliament Hill in Ottawa March 3, 2009. REUTERS/Chris Wattie</p>