by John West

Discussions led by business leaders at the recent Toronto Global Forum suggest that Canada's economy is sitting on a knife edge.

Prospects for the world economy are gloomy and fragile, something Canada cannot insulate itself from. Europe's economy is on the verge of falling back into recession. Growth is slowing in China, Brazil and India. Economic uncertainty is rising due to the feared spread of Ebola, sanctions against Russia, and turmoil in the Middle East.

The U.S. may be a bright spot in the global economy, with steady growth since 2010, but this is its weakest post-war recovery. And as the U.S. normalizes monetary policy after six years of quantitative easing, global financial markets will experience increased volatility.

It was suggested that the conference banner of “rethinking growth” should be re-formulated as “remembering growth“.

These past few years, Canada has been a success story, according to Minister of State for finance, Kevin Sorenson, thanks to the government's timely stimulus to minimize the effects of the global financial crisis. Canada has achieved steady growth, with low debt and a good employment record, and has outperformed the G7.

Canada has been an island of stability in an unstable world, said Sorenson. Its middle class incomes are better than America's. It is also the best place to raise a family.

Despite its success, however, it seems clear that Canada faces many challenges, going forward.

Michael Sabia of the Caisse de depot et placement du Quebec made a strong case for infrastructure spending to boost the global economy. There is potential to generate $4-5 trillion dollars annually in global infrastructure spending.

But Canada itself is in desperate need of infrastructure investment to get its natural gas and oil to Asian export markets. Pipeline and other projects are bogged down by opposition from aboriginal and local communities, and environmentalists. A number of accidents have also raised public concerns about safety.