Canadian economy needs an energy boost: David Doyle
Canada’s economy is at a “critical juncture” as it confronts a number of headwinds but the country’s energy sector remains a bright spot, according to one economist.
David Doyle, North American economist and Canadian market strategist at Macquarie Group, said that while the Canadian economy has shown recent signs of strength, a combination of challenges on the housing, productivity, and trade fronts will cause a prolonged period of weak GDP growth for the country.
“Canada’s economy, we think, is at this critical juncture, and it’s confronting several headwinds – that includes challenged demographics, low productivity, structural imbalances like the housing situation and our trade deficit,” Doyle told BNN Bloomberg in an interview Thursday.
“And we see a real absence of growth drivers.”
Doyle said areas like manufacturing likely won’t make a comeback to contribute to the country’s economic growth in a meaningful way.
And while the tech industry is often considered an area of strength for the country, Doyle argued it’s difficult to argue that Canada has a comparative advantage in that sector compared to the United States.
While he acknowledged the recent challenges in the energy sector including declining investment and low oil prices, Doyle said the industry still has a big impact on Canada’s overall economy.
“The area that we think is the engine of growth of Canada is the energy sector,” Doyle said.
He also said Canadians see oil and gas as a critical industry, citing a recent Angus Reid Institute poll that revealed the majority of Canadians see the lack of pipeline capacity as a “crisis.”
“Even in this period of subdued growth in the energy sector, it’s still a major contributor to Canada’s economy and a major contributor to the well-being of households across the country,” Doyle said.