OTTAWA (Reuters) - Canada will continue to take action in concert with other countries to mitigate the impact of the global financial crisis on the economy, Prime Minister Stephen Harper said on Monday.
Harper, who is campaigning for reelection in the October 14 general election, said the coordinated action by global central banks, including Canada‘s, is designed to “help” the United States and others that are being rocked by financial instability. He said such instability is notably absent in Canada.
“I think the measures taken today are simply to ensure we coordinate central banks around the world, coordinate their response, and particularly assist those economies, particularly the American economy, where there is considerable financial instability,” Harper told reporters.
“We will continue to take measures in concert with other countries, because there are international capital flows, to ensure that we also help them deal with their domestic situations,” he said.
Harper said he has no immediate plans to propose changes to the Canadian financial system to help it avert the kinds of failures seen on Wall Street and now in Europe.
But he said he stands ready to propose legislation if advised to do so.
“We aren’t proposing legislation at the moment but if there’s belief that we could strengthen our system in any way that requires legislation, we would follow that,” Harper told reporters in Ottawa.
“We would obviously be listening to central bankers and other regulators as they’re doing ongoing evaluation in concert with their G7 partners on what we may need to do,” he said.
His remarks came as contagion from the global credit crisis spread, prompting many to speculate about which country would fall victim next.
In recent events, U.S. regional bank Wachovia Corp agreed to sell most of its assets to Citigroup in a deal brokered by the Federal Deposit Insurance Corp. And authorities stepped in to rescue three European banks and other rescue deals emerged in the region.
Earlier on Monday, the Bank of Canada expanded its swap facility with the U.S. Federal Reserve to US$30 billion from US$10 billion as part of a coordinated action by global central banks to revive the paralyzed global financial system through massive injections of cash.
But Canada has no need to draw on the facility at the moment, the central bank said.
Reporting by Randall Palmer; Writing by Louise Egan; Editing by Peter Galloway