BUSINESS

Canadian GDP Lags U.S., Japan And Germany: OECD

03/28/2013 07:11 EDT | Updated 05/28/2013 05:12 EDT
CP
PARIS - A leading international economy body says the global economy is beginning to rebound, but Canada is lagging several other members of the Group of Seven countries.

The OECD estimates Canada's economy will grow by 1.1 per cent in the first quarter — much slower than the United States or Japan and below the G-7 average — but pick up steam and grow by 1.9 per cent in the second quarter.

The average for Group of Seven countries, which include Canada, the United States, Japan and four European Union members, is estimated at 2.4 per cent in the first quarter and 1.8 per cent in the second.

The Organization for Economic Co-operation and Development estimates the U.S. economy advanced 3.5 per cent in the first quarter, which ends this month, but that its growth will moderate in the second quarter to 2.0 per cent.

Likewise, the OECD expects Japan's growth will be a robust 3.2 per cent in the first quarter — which ends this month — and but the pace will slow in the second quarter to 2.2 per cent.

Among the Euroepan G-7 countries covered by the OECD report, Germany will be the only one growing faster than Canada — at 2.3 per cent in the first quarter accelerating to 2.6 per cent in the second quarter.

The U.K. economy is expected to have only 0.5 per cent growth in the first quarter and 1.4 per cent in the second quarter.

France's economy is expected to contract by 0.6 per cent in the first quarter but grow 0.5 in the second. Italy's economy is expected to shrink in both quarters, dropping 1.6 per cent in the first quarter and 1.0 per cent in the second.

In an interim assessment that focused on the Group of 7 leading industrial economies, the OECD says Thursday that the European Central Bank needs to do more to encourage banks to lend and economies to grow.

It notes that countries that use the euro are making progress in reducing their debts, but that some should be allowed to meet their targets more slowly to temper the impact on the economy.

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