The current economic turmoil is certainly a cause for concern, but it also can be a time for opportunity and hope - if we are prepared to take bold action



    TORONTO, April 15 /CNW/ - Despite public concerns about the current
economic slowdown, Canadians have an opportunity to build our future
prosperity by ensuring we keep a balanced perspective on short-term and
long-term challenges. In their Report on Canada, Opportunity in the turmoil,
the Institute for Competitiveness & Prosperity and the Martin Prosperity
Institute call on individuals, business leaders, and governments to look for
hope and optimism in the stormy times of the current economic downturn.
    "This Report comes at a time of unprecedented economic volatility and
uncertainty in Canada and around the world," said Roger Martin, Chairman of
the Institute for Competitiveness & Prosperity and Dean of the University of
Toronto's Joseph L. Rotman School of Management. The Report notes that the
financial crises in many countries and the economic slowdown have led to
reduced public confidence, wild swings in stock markets, and the return of
huge government deficits. In Canada, our manufacturing industries are being
challenged by lower demand worldwide; our financial institutions face ever
greater uncertainty; weakened commodity prices are hurting our resource
industries; and our construction and real estate sectors are under duress.
    Martin emphasized, "My colleagues and I are highly sensitive to the
economic turmoil and hardship that have beset many of us. But our financial
institutions have withstood the gale force of economic headwinds better than
perhaps all others in the world. Our governments are less burdened by debt
than many other countries." In a better situation than other countries, Canada
can keep the long-term in mind.
    The Report argues that this is the time for attitudes of openness and
expansion. While other countries, most notably the United States seem to be
taking a more insular and protectionist approach, Canada has to be open to
foreign investment, global trade, and talented immigrants so that we can
approach the eventual economic recovery in a relatively stronger position.
    As in its previous Reports, the need for investing in our future
prosperity continues to be a key theme. "Canada is among the most prosperous
economies in the world," said Martin, "but, we are productivity and innovation
laggards. Some of this is the result of under investing in technology and
research by our businesses; some of it is the result of inadequate investment
in education and skills by our people and our governments. We need to find
ways to ensure that we are not cutting off investment because of short-term
pressures."
    The Report sees some bright spots in our tax policies, both federally and
provincially. The recent Ontario Budget supported new job creating investments
by harmonizing the provincial sales tax with the federal Goods and Services
Tax (GST) and by reducing provincial corporate income tax rates. In New
Brunswick, recent tax reductions are also a step in the right direction. As
Martin observed, "with recent federal and provincial tax measures, Canada will
be one of the most attractive places for new business investment in the
world." The Report calls on governments to explore even more innovative tax
policies for Canada's long-term advantage.
    Finally, the Report encourages the federal government to adopt the
Competition Policy Review Panel's recommendations, that in the globalizing
economy the best defence for our companies is a good offence. The Report also
draws on some new research that indicates that, while Canadian companies are
among the best managed in the world, they have potential for improvement. In
an innovative economy, strong management and scientific skills are both
necessary.
    While Canada is one of the most prosperous jurisdictions in the world, we
under achieve our prosperity potential, as defined by the gap in GDP per
capita with the United States - even with the most recent reported results. As
Martin observed, "Regardless of short-term economic events, we need to keep an
eye on our long-term prosperity in our increasingly competitive global
economy. And we have some great opportunities to take actions today that will
lead to realizing our potential."

    
    ------------------------------------------------------------------------
    Opportunity in the turmoil: Summary of recommendations

    Attitudes: Keep eye on long-term prosperity potential
    -   Prime Minister, Premiers, and business, labour, and community leaders
        to turn up volume on the importance of prosperity and productivity
        even in these times of economic uncertainty

    Investment: Continue to invest in long-term prosperity
    -   Enhance educational opportunities
    -   Support groups at risk of falling into poverty
    -   Step up investments in information and communication technology
    -   Raise our investment in people

    Motivations: Adopt bold tax innovations
    -   Reduce overall taxes on new business investment, especially in the
        service sector
    -   Consider a carbon tax
    -   Pursue bold new approaches to taxation

    Structures: Make Canada a competitive and open economy for the Creative
    Age
    -   Enhance our market structures to build skills and management
        capabilities, encourage competition, and stimulate innovation at home
        and abroad
    -   Continue to draw on creativity-oriented and international skills for
        our prosperity
    -   Pursue the reduction of barriers to investment and trade
    ------------------------------------------------------------------------
    

    The complete report can be downloaded directly from:
http://www.competeprosper.ca/download.php?file=Report_on_Canada_2009.pdf

    About the Institute for Competitiveness & Prosperity

    The Institute is an independent not-for-profit organization established
in 2001 to serve as the research arm of Ontario's Task Force on
Competitiveness, Productivity, and Economic Progress. The Institute and the
Task Force are supported through the Ministry of Economic Development and
Trade.

    About the Martin Prosperity Institute

    The Martin Prosperity Institute at the University of Toronto's Rotman
School of Management is the world's leading think-tank on the role of
sub-national factors - location, place and city-regions - in global economic
prosperity. Led by Academic Director Richard Florida, we take an integrated
view of prosperity, looking beyond economic measures to include the importance
of quality of place and the development of people's creative potential.




For further information:

For further information: James Milway, Executive Director of the
Institute for Competitiveness & Prosperity at (416) 920-1921 ext. 222

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