CANADA’S ECONOMIC GROWTH LOWER THAN EXPECTED Statistics Canada reported that Canadian exports surged between April and June resulting in the largest increase seen in the last four years with energy products showing a 3.6 percent increase. Data shows household spending rose by 0.6 per cent, doubling results from the first quarter. However, spending by businesses slowed showing a minimal growth of only 0.4 percent for the period. A slowdown in business spending was to be expected after a strong start to the year, “but this component is definitely one to watch carefully going forward,” said Toronto-Dominion Bank economist, Brian DePratto after the numbers were released. Canada’s gross domestic product was slightly less than economists predicted for June, growing 2.9 percent, but not the predicted 3.1 percent.
OTTAWA TO MOVE FORWARD WITH TRANS MOUNTAIN PIPELINE The ink is hardly dry on the federal government’s $4.5- billion deal to buy the Trans Mountain pipeline and expan- sion project from Kinder Morgan Inc. and already a major setback as the Federal Court of Appeal has overturned the pipeline’s construction permits. Appeals Court judge, Eleanor Dawson ruled that the federal government did not carry out its duty to consult with affected First Nations on the project and that the National Energy Board’s report was flawed because it did not consider the issue of tanker traffic. The project will now need to undertake new reviews if it is to move forward, which is not good news for the Canadian oil industry. However, even with this latest setback the federal govern- ment remains committed to building the pipeline. “This is a project that’s in Canada’s national interest. A project that means thousands of good, well-paying jobs for the middle class,” said Canadian Finance Minister, Bill Morneau. Morneau goes on to say, “This one will be a strong, commer- cial project once we de-risk it. That’s what we’re attempting to do, so we can be in the market in the long term.” The court decision is expected to cause further delays to the project and drive up its final price tag, previously estimated at $7.4 billion. Kinder Morgan’s disclosures had shown the price could rise as high as $9.3 billion if construc- tion wraps up in 2021.
In comparison, south of the border the U.S. economy grew at a 4.2 per cent pace during the same period.
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SPOTLIGHT ON BUSINESS MAGAZINE • SEPTEMBER 2018
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