Canada's Finance Minister Jim Flaherty said Sunday that Canada may be headed for a "technical recession" at the end of this year and in early 2009.
"We may well be in a technical recession the last quarter of this year and the first quarter of next year," Flaherty said during an interview with Canadian Television.
Usually, a recession is defined as two consecutive quarters of negative growth. The Canadian government has avoided the word, only saying that Canada is not immune from the economic turbulence beyond its borders before Sunday's statement.
Prime Minister Stephen Harper also said in Lima Sunday that Canada could be in a recession later this year or in early 2009.
"The most recent forecasts, and there have been a series of predictions...there is a suggestion that there might be a technical recession at the end of this year or the beginning of next," he said.
"Indeed, the economic growth is just about zero, perhaps a little bit less, but it is a technical recession," Harper said.
Harper said he was open to the idea of injecting a large sum of government funds into the failing economy over the short term, provided that any resulting deficit would be a short-term solution.
But Flaherty predicted that Canada would end the current fiscal year with a modest surplus.
Canada's parliamentary budget officer, Kevin Page, issued a report earlier this week that predicted a huge federal deficit if the economy continues to weaken.
Canada has been registering huge surpluses each year during the past decades, mostly under the former Liberal governments.
(Xinhua News Agency November 24, 2008)
