Finance Minister Bill Morneau answers a question during Question Period in the House of Commons on Parliament Hill in Ottawa on Tuesday, November 1, 2016.

Finance Minister Bill Morneau answers a question during Question Period in the House of Commons on Parliament Hill in Ottawa on Tuesday, November 1, 2016.
Photo Credit: PC / Adrian Wyld

Liberals promise $81B in new infrastructure spending to kick-start sluggish economy

The Liberal government of Prime Minister Justin Trudeau is responding to the stubborn sluggishness of Canadian economy by boosting infrastructure spending while making it easier for the private sector and foreign buyers invest in the country.

The Liberals will pour an additional $81 billion from 2017 to 2028 into major infrastructure projects ranging from public transit to rail and port infrastructure to make it easier to export Canadian goods, said Finance Minister Bill Morneau as he tabled his fall economic update Tuesday.

The government also hopes to harness the financial resources of private investors to its infrastructure spending strategy. Ottawa will make at least $35-billion available for a new infrastructure bank with the hope that it will attract four times that amount from global pension funds and other investors, Morneau said.

Red ink in forseeable future

In the meantime, Ottawa is swimming in a sea of red ink with no balanced budgets in sight in the foreseeable future.

Canada’s federal deficit is set to hit to $25.1 billion by the end of the current year, falling to $14.6 billion in 2021-2022, Morneau said as he drew an increasingly dire picture of the Canadian economy.

“What we want to tell Canadians is we believe that we should be focused on making investments for today and for tomorrow that will allow us to have a higher level of economic growth in this country,” he said. “We know we are doing it in a fiscally responsible way.”

Easier to buy Canadian companies

The federal government is creating an “Invest in Canada” sales force to attract new foreign investment and encourage companies to expand further into Canada.

The government is also making it easier for large foreign investors to buy Canadian companies by increasing the threshold for foreign takeovers that would require a government approval and simplifying rules over national security provisions.

The update also promises to speed up visa processing for low-risk, high-skill talent and to introduce a new work permit exemption for short-duration work terms, applying to terms of less than 30 days in a year, or brief academic stays.

With files from CBC News and The Canadian Press

Categories: Economy, Politics
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