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Canada in economic rebound despite recession: PM

Xinhua, September 3, 2015 Adjust font size:

Canada is officially in a recession, mainly as a result of a downturn in the country's oil and gas sector, Statistics Canada (StatsCan) confirmed Tuesday.

The agency, in charge of national data collection and analysis, reported that Canada's real gross domestic product (GDP) declined by 0.5 percent in the second quarter of 2015, following a 0.8-percent drop in the first quarter.

By definition, two consecutive quarters of negative economic growth as measured by a country's GDP constitute a recession. However, in Canada' s case, it isn't all bad news, StatsCan said.

Exports rose by 0.4 percent in the second quarter, while consumer spending increased by 2.3 percent.

Still, any mention of a recession isn't good news for Prime Minister Stephen Harper as he seeks to keep his Conservative Party in power when Canadians head to the polls on Oct. 19.

His stay-the-course campaign message that the Tories have the steadiest hands to guide the Canadian economy is overshadowed by the fact that Canada is the only G7 country in recession and that this one is the second, following the Great Recession of 2009, to occur during his time in office.

By contrast, the real GDP of the United States rose by 3.7 percent in the second quarter, StatsCan said.

Harper's political opponents are reminding voters about Canada's weak economic performance under his watch.

Thomas Mulcair, who leads Canada's left-of-center New Democratic Party that has been polling at comparable numbers to the Conservatives, said Tuesday that Harper's economic plan is "failing," while Liberal leader Justin Trudeau said the prime minister's approach was "not working" for Canadians.

Yet StatsCan also reported Tuesday that after falling for five consecutive months, Canada's GDP rose by 0.5 percent in June, primarily thanks to an increase in mining, quarrying, and oil and gas extraction.

That, said Harper, shows that the Canadian economy is "back on track" -- an opinion shared by private-sector economists.

Canada's economic contraction "looks to be in the rear-view mirror," BMO Capital Markets chief economist Doug Porter reassured clients in a note. TD economist Brian DePratto also said that "despite the weak start to the year, there is good reason to believe that the worst is over." Endit