February 23, 2009 / 4:36 PM / in 9 years

No U.S. financial fix, no recession end: Harper

OTTAWA (Reuters) - Canadian Prime Minister Stephen Harper, voicing deep concern about the financial system in the United States and other countries, said on Monday he could not see how the current recession can end until they are fixed.

<p>Canada's Prime Minister Stephen Harper departs after meeting with United Nations Secretary General Ban Ki-moon at the U.N. Headquarters in New York February 23, 2009. REUTERS/Chip East</p>

“We’re obviously all hugely worried about the American financial system and about the financial system of some other countries,” the Conservative leader said in an interview in New York with Fox News.

“Frankly...until that problem gets fixed, it’s hard for me to see how we’re going to turn the corner on this recession that we’re in now.”

He also said Canada did not have the same financial sector problems as in the United States.

“We haven’t had to bail out any of our financial institutions. We don’t have the mortgage problem. Certainly, we have a downturn in our housing sector, but it’s not structural. There will be no government bailout of mortgages in Canada,” he said.

One of the strengths of Canada’s financial system, he said, is its compactness, with just six major banks and three major insurance companies.

“So it’s easier for the government to exercise moral suasion on the sector,” he said, noting that the government superintendent of financial institutions meets regularly with those institutions.

Harper also said the Canadian government, which had run surpluses for more than a decade until this year, should be able to return to budget surplus in about four years.

Reporting by Randall Palmer; Editing by Peter Galloway

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