Canadian Retailer - Winter 2013 - 30

THE ECONOMY

Few fiscal measures

Despite how Canadian businesses
choose to view the current economic
conditions, they will likely have to
wait out this period of uncertainty.
Government has few tools left to
spur economic growth, particularly
because of growing unease about
sizeable debts held by Canadian
households.
“[Government and the Bank of
Canada] are worried about household debts going up, so they don’t
want to encourage spending too
much. But if the economy starts to
slide, you need that consumer spending in order to prop up the economy,”
explains Moffatt. Striking a balance
between policies that encourage
spending and discourage debt puts
Canadian policymakers in a bind.
“If they get too loose with their
policy, we’re going to start getting
larger consumer and mortgage
debt,” says Moffatt. “If they get too
tight with their policy, if they try to

cut down on consumer spending
and debt, that’s going to cause some
problems for retailers.”
What could help Canadian retailers—and the entire world economy—is
greater stability in U.S. policymaking.
If fewer shockwaves radiate from
Washington, the calmer consumers
will be in the U.S. and Canada.
This means making long-term decisions about taxes and spending—
something that didn’t come out of
the December 2012 negotiations.
“It’s really the uncertainty that’s

hurting the U.S economy. What the
U.S. economy really needs right now
is some long-term perspective, so
people know what tax rates are going
to be, what government spending is
going to be three, six, nine months
down the line,” says Moffatt.
Regardless, conditions are such
that even with clarity in economic
policy, 2013 will likely remain a year
of recovery.
“You’re still going to be looking at
a pretty sluggish economic environment here in Canada,” says Ferley.

RETAILERS SCORE SENATE COMMITTEE REPORT ON PRICE DIFFERENTIAL AN ‘A’
Retail Council of Canada (RCC) has awarded an ‘A’ to the report of the Senate
Committee on National Finance examining the price differences between
Canada and the U.S., noting that it reflects retailers’ cost pressures and offers
some good recommendations on two categories that have significant influence
on pricing—tariffs and country pricing.
The Committee has recommended the government review tariffs, with “the
objective of reducing the price discrepancies for certain products between
Canada and the United States”, and has clearly acknowledged the reality and
negative impact of the practice of country pricing on Canadian retailers.
For more information, visit RCC's website www.retailcouncil.org, or contact Sally
Ritchie, VP Communications, RCC, at 416 922-0553 ext. 228.

Thanks
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We are proud to work
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68 per cent
68 per cent

Programs to change the
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life cycle of products,

With the support
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www.StewardshipOntario.ca

30 |

620828_Stewardship.indd 1

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Canadian Retailer - Winter 2013

Table of Contents for the Digital Edition of Canadian Retailer - Winter 2013
