'Fortune favours the bold'

Dave Bartlett
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Economy Bank of Canada governor speaks in St. John's

The governor of the Bank of Canada says now is not the time to sit back and wait for the economy to improve.

"The theme of my remarks is about boldness," Mark Carney told an early morning crowd at the Newfoundland and Labrador Oil and Gas Industries Association's (NOIA) Friday breakfast.

Mark Carney

The governor of the Bank of Canada says now is not the time to sit back and wait for the economy to improve.

"The theme of my remarks is about boldness," Mark Carney told an early morning crowd at the Newfoundland and Labrador Oil and Gas Industries Association's (NOIA) Friday breakfast.

And he said the Canadian economy should learn from the dogged determination of the people of this province.

"We're all products of our environment and the people of Newfoundland and Labrador reflect the bold drama of this province's geography and its history," Carney said. "And at this point in time, Canada and the world can learn a lot from you because we're going to need to call upon similar boldness."

Recession

Carney then launched into a 20-minute speech on the recent recession, the current recovery and the challenges of the future.

He said though it was a short recession, it was also severe with 400,000 Canadians being tossed out of work and several of the country's industries "undergoing deep restructurings."

But Carney said as painful as it was, Canada suffered less than most other economies for two main reasons - a "highly credible monetary policy" and a "well-functioning financial system."

Even still, he said, the aftershocks will be felt for years.

He also said Canada is not a "bystander in the global upheaval."

But instead, the country now has the opportunity to influence policies and reforms around the world, said Carney.

"The efforts that will be required of all of us will be heroic and hesitation will be costly," he said. "The old adage that fortune favours the bold very much applies."

Carney went on to say the global recovery is proceeding but is uneven across economies.

The recovery in Canada, he said, is largely unfolding as expected but with "considerable uncertainties."

With other countries tighten their belts, Carney said the coming "age of austerity" carries its own risks, and policy makers must resist trade and financial protectionism.

"Waiting on the sidelines ignores both the scale of the challenge and the opportunities presented by Canada's historic underperformance and the current transformation of the global economy," he said.

Carney also said Canada has fallen behind in productivity and research and development investments. He urged the private sector to step up.

While governments are moving ahead with reforms, he said, they can't simply "will" companies to take risks.

"I should stress that Newfoundland and Labrador is an exception in this regard," said Carney. "Major capital investments over the next couple of years in mining, public infrastructure and oil and gas will all but guarantee a few years of very strong growth."

"We would all do well to follow your example," he continued.

dbartlett@thetelegram.com

Organizations: Bank of Canada, Newfoundland and Labrador Oil and Gas Industries Association

Geographic location: Canada, Newfoundland and Labrador, St. John's

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