Choppy waters coming for the global economy, potential slowdown: Justin Trudeau
Canada’s prime minister said he sees strong signs of economic turmoil ahead, but uncertainty about how severe a downturn could be.
“I think we're all aware that there are choppy waters coming for the global economy (and a) potential slowdown. The question is more about how long it'll last, how deep it will be, and where it'll hit hardest,” Justin Trudeau said in a Friday interview with Bloomberg Television.
Trudeau said job losses would be the most significant problem associated with a global economic downturn, but he added that the labour market currently remains strong.
Canada’s economy added 35,000 jobs in March amid strong population growth, according to the latest data from Statistics Canada.
Given current economic uncertainty and labour market strength in both the U.S. and Canada, Trudeau said “job losses may or may not be that significant.”
“One way or another, in Canada, we're going to be ready with supports if it happens,” he said.
The prime minister added that inflationary pressures are starting to ease rapidly.
“We should be down (to) around three per cent (inflation) or even lower by the summer, so that'll take a lot of the pressure off,” Trudeau said.
RESPONSE TO U.S. GREEN INCENTIVES
Trudeau said Canada’s economy will continue to benefit from its critical minerals and “great workforce,” fuelling the value proposition for foreign investment.
Canada’s prime minister said his government has also had to respond to a key piece of legislation in the U.S., the Inflation Reduction Act (IRA), which offers incentives for green investments.
“The IRA is something that we've had to step up to make sure that we're competitive, but we're going to be a lot more strategic about how we pick and choose the right investments,” Trudeau said
Volkswagen’s planned electric vehicle battery plant in St. Thomas, Ont., is an example of this strategic approach, according to Trudeau, who said the facility will be able to create “a million batteries a year for the next decades.”
The German automotive company announced plans for the battery facility last month and said production is expected to begin by 2027.
Trudeau said that for the past eight years, his government has been working diligently to create a framework for green investment. Ongoing efforts for nearly a decade provide the nation with a competitive advantage, he added.
“The IRA is a little bit of a response to what Canada has been doing and that the U.S. fell behind on for four years under the previous administration, [while] not looking at the incredible opportunities that come with climate leadership,” he said.