Justin Trudeau’s government is proposing a raft of funding for Canadian companies — including money for infrastructure and tax incentives for carbon-capture technology — aimed at emerging from the global pandemic with a stronger economy than before.
In a budget proposal released Monday, about C$60 billion ($47.9 billion) of C$101.4 billion in new spending over three years is focused on medium-term measures to improve growth.
Much of that is geared at increasing labor force participation through measures like child care, but there are also tens of billions of dollars devoted to direct business spending, the bulk of it aimed at transitioning to a greener economy.
“The resource and manufacturing sectors that are Canada’s traditional economic pillars — energy, mining, agriculture, forestry, steel, aluminum, autos, aerospace — will be the foundation of our new, resilient and sustainable economy,” Finance Minister Chrystia Freeland said in her planned remarks to Parliament. “Canada will become more productive and competitive by supplying the green exports the world wants and needs.”
Among the highlights:
Although some of this spending will provide near-term stimulus, its main purpose is to expand the country’s growth potential, a senior government official said, which is why many of the projects aren’t shovel-ready.
Locking in robust medium-term economic growth is core to the government’s plan to spend its way out of the pandemic, while gradually reducing the debt-to-GDP ratio.
The green measures will help Canada achieve its goal of cutting greenhouse gas emissions 36% from 2005 levels by 2030 and reaching net-zero emissions by 2050, the government said.