Fall of U.S. auto giants to cost Canada 600,000 jobs
Wednesday, 17 December 2008, 18:49 IST   |    1 Comments
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Toronto: The collapse of the three big American carmakers could cost Canada more than 600,000 jobs, a report by the Centre for Spatial Economics has warned. According to the report published Tuesday, 323,000 Canadian jobs could disappear immediately if the US administration failed to bail out General Motors, Chrysler and Ford. Auto manufacturing is a pillar of the Canadian economy. Ontario province, which is Canada's economic engine accounting for more than 40 percent of the national economic output, will loss more than 280,000 jobs immediately if the big three were to go under. Canadian plants, which account for 15 to 20 percent of the total output by the three American auto giants, are mostly based in Ontario province which also supports 40 percent of the Canadian population of 33 million. To save auto jobs, the Canadian government has proposed a proportionate $3.5 billion package for the struggling sector - against the $15 billion rejected by the US Senate. The report warned that the collapse of the auto sector will have a deadly effect on other sectors of the economy, including retail and services. Amid this gloomy scenario, Canadian Prime Minister Stephen Harper warned about the possibility of a depression. "It could be, but I think we have learned enough about depression, we have learned enough from the 1930s to avoid some of the mistakes that caused a recession in 1929 to become a depression in the 1930s," the prime minister told a television network. "The truth is, I've never seen such uncertainty in terms of looking forward to the future. I am very worried about the Canadian economy," he added. The prime minister has proposed to earmark billions of dollars for spending in the budget next month to ease recession. Meanwhile, the Canadian dollar - the loonie - made some gains against the US dollar with the Federal Reserve announcing cuts in interest rates to a record low of zero to 0.25 percent. The loonie jumped as high as 2.25 percent against the greenback, to close at 83.21 cents US - a net gain of 2.02 percent in a single day.
Source: IANS
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