Finance Minister Joe Oliver says he is concerned that divisions within Canada over the energy sector will eventually hold back the country’s growth.
In a year-end interview for The Exchange with Amanda Lang, Oliver cited opposition to fracking and to pipelines in some provinces as potential points of conflict.
“It’s important to communicate with Canadians that we’re not just missing out on a new opportunity. We’re potentially also looking at a decline which would adversely affect the Canadian economy and degrade the standard of living of Canadians across the country,” Oliver said.
New Brunswick recently announced it would impose a moratorium on fracking and Quebec and Ontario have set conditions for the development of the Energy East pipeline within their borders.
Pipelines critical to economy
Oliver terms the need to get Canadian oil to tidewater so it can be shipped overseas a “critical strategic imperative” for the country.
He said the inability to gain agreement to build the Keystone XL pipeline through the U.S. so far was disappointing, but he believes that a pipeline to secure export markets will eventually go through.
“We have a critical strategic imperative, which is to diversify our markets because 100 per cent of our gas exports, 99 per cent of our oil exports go to the U.S.,” Oliver said.
“They’ve found vast amounts of their own and they’re in the process of competing with us on gas,” he added.
He upheld the prime minister’s view that a carbon tax which would show Canada is moving to combat climate change would not be the right move at this time.
The Obama administration has suggested it is looking for proof that Canada is moving to combat climate change before it would approve Keystone.
“What we have said, what the prime minister has said is ‘we’ll move with other countries, but this is not the time to disadvantage Canadian industry in a significant way.’ It simply doesn’t make sense,” Oliver said.
Oliver dismisses carbon tax
He insisted Canada is serious about dealing with greenhouse gases and would move when other countries move, but said he doesn’t believe there is international pressure to put a carbon tax in place.
“I haven’t heard anybody suggest that the U.S. is about to introduce a carbon tax. I think with the change in the Senate and the House of Representatives, that’s an extremely unlikely event,” Oliver said.
“Why introduce a carbon tax here to show that we are serious about climate change when they haven’t done it?” he added.
A 2014 report on Canada’s greenhouse gas emissions shows the country will fall short of meeting its 2020 targets that were agreed to in Copenhagen for reducing the emissions that lead to climate change. The world is set to implement tougher emissions targets when delegates gather in Paris next year.
Oliver points out that Canada is “very wealthy” and has an opportunity to prosper even more in the years ahead.
But there are headwinds from Europe and other more troubled economies, even as the U.S. picks up steam.
“The fact that Europe is poised to either start recovering or decline is a concern,” he said.
“There are geopolitical issues that have economic and other implications for Canada. We’re in pretty good shape, but the international situation is fragile,” he said.
Oliver said his goal is to create economic stability for Canadians and that’s part of the reason he believes it’s important to have balanced budgets and bring down the debt.
“We want to be strong in the event there are international shocks, which are inevitable from time to time,” he said.
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