Economy

IMF sees global economy improving despite uncertainties – FRANCE 24

Published

4 years ago

March 30, 2021

Issued on: 30/03/2021 – 17:26Modified: 30/03/2021 – 17:24

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Washington (AFP)

Economic growth led by the United States and China is accelerating, amplifying the risks of an uneven global recovery, the head of the IMF said Tuesday.

“In January we projected global growth at 5.5 percent in 2021,” said IMF Chief Kristalina Georgieva in an address ahead of the body’s annual spring meeting cohosted with the World Bank.

“We now expect a further acceleration,” she said ahead of the international organization’s official update of its forecast in a week.

Key factors in the improved outlook includes the US passage of President Joe Biden’s $1.9 trillion economic relief package and an expected bounce from coronavirus vaccines increasingly available in larger economies, Georgieva said.

She also praised the “extraordinary effort” of workers throughout the health care universe, including doctors, nurses and vaccine scientists.

Governments played a key role in averting a worldwide depression, Georgieva said, with some $16 trillion in fiscal support and a “massive liquidity injection by central banks” averting complete disaster.

Without these steps, the worldwide economic contraction of 3.5 percent in 2020 “would have been at least three times worse,” she said.

– ‘Extremely high uncertainty’ –

But the IMF is seeing increasing signs of a “multi-speed recovery” powered by the United States and China, which are on track to enjoy growth by the end of 2021 that outpaces their pre-crisis performance.

In general, the global outlook remains clouded by “extremely high uncertainty,” with economic activity still tied closely to the pandemic.

“So much depends on the path of the pandemic — which is now shaped by uneven progress in vaccination and the new virus strains that are holding back growth prospects, especially in Europe and Latin America,” she said.

Especially vulnerable are emerging markets with more “fragile” government.

“Many are highly exposed to hard-hit sectors, such as tourism,” she said. “Now they face less access to vaccines and even less room in their budgets.”

A keen worry in a global economy fractured by different-paced recoveries would be a sudden rise in US growth that leads to a jump in interest rates and capital flight from emerging regions.

“We expect inflation to remain contained, but faster US recovery could cause a rapid rise in interest rates, which could lead to a sharp tightening of financial conditions — and significant capital outflows from emerging and developing economies,” she said.

Georgieva urges generous investment in the production and distribution of vaccines to facilitate the transition to the post-Covid economy.

She also backs increased investment for the most vulnerable countries, as well as spending on infrastructure, health and education so that “everyone can benefit from the historic transformation to greener and smarter economies.”

This group of nations requires $200 billion over five years to overcome the pandemic and another $250 billion to return to a trajectory of meeting richer countries, said Georgieva, citing a recent IMF study.

The IMF has already provided $107 billion in financing and debt service relief for the 29 nation poorest nations. This includes support for sub-Saharan Africa at about 13 times the level previously.

Support within the international organization is also building for lending some $650 billion in special drawing rights to aid the most vulnerable nations, she said.

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Economy

Minimum wage to hire higher-paid temporary foreign workers set to increase

Published

1 day ago

October 21, 2024

Anne Joseph

OTTAWA – The federal government is expected to boost the minimum hourly wage that must be paid to temporary foreign workers in the high-wage stream as a way to encourage employers to hire more Canadian staff.

Under the current program’s high-wage labour market impact assessment (LMIA) stream, an employer must pay at least the median income in their province to qualify for a permit. A government official, who The Canadian Press is not naming because they are not authorized to speak publicly about the change, said Employment Minister Randy Boissonnault will announce Tuesday that the threshold will increase to 20 per cent above the provincial median hourly wage.

The change is scheduled to come into force on Nov. 8.

As with previous changes to the Temporary Foreign Worker program, the government’s goal is to encourage employers to hire more Canadian workers. The Liberal government has faced criticism for increasing the number of temporary residents allowed into Canada, which many have linked to housing shortages and a higher cost of living.

The program has also come under fire for allegations of mistreatment of workers.

A LMIA is required for an employer to hire a temporary foreign worker, and is used to demonstrate there aren’t enough Canadian workers to fill the positions they are filling.

In Ontario, the median hourly wage is $28.39 for the high-wage bracket, so once the change takes effect an employer will need to pay at least $34.07 per hour.

The government official estimates this change will affect up to 34,000 workers under the LMIA high-wage stream. Existing work permits will not be affected, but the official said the planned change will affect their renewals.

According to public data from Immigration, Refugees and Citizenship Canada, 183,820 temporary foreign worker permits became effective in 2023. That was up from 98,025 in 2019 — an 88 per cent increase.

The upcoming change is the latest in a series of moves to tighten eligibility rules in order to limit temporary residents, including international students and foreign workers. Those changes include imposing caps on the percentage of low-wage foreign workers in some sectors and ending permits in metropolitan areas with high unemployment rates.

Temporary foreign workers in the agriculture sector are not affected by past rule changes.

This report by The Canadian Press was first published Oct. 21, 2024.

— With files from Nojoud Al Mallees

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Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

Published

5 days ago

October 17, 2024

Anne Joseph

OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

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Economy

Statistics Canada says levels of food insecurity rose in 2022

Published

6 days ago

October 16, 2024

Anne Joseph

OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

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