WILL CANADA EXCEED 3%+ GDP GROWTH FOR 2017By: Paul Young CPA, CGADate: April 15, 2017

WHAT DRIVES GDP GROWTH▪ Consumer Spending

▪ Business Spending

▪ Government Spending

CANADA GDP – JANUARY 2017

▪ Source – Stats Canada

Factors that will influence GDP• Government budgets are strapped for

Cash• Impact of Carbon Taxation and/or

hydro rates have not work through the complete supply chain

• Inflation is over 2.3%• Wages continue to be stagnated• Business investment is weak• Oil Prices are up, but struggling to get

above $55/Barrel• Trump’s economic policies have yet to

be implemented• Consumer spending main drive is large

purchases. Automotive sales have pulled back in March 2017

• Weak global Demand

2017-2018 – FEDERAL BUDGET

Chamber of Commerce/Calgary – April 4, 2017

We agree that Budget 2017 sets some foundation for a more competitive and innovative Canada. This is done by encouraging superclusters (Silicon Valley is a great example of a supercluster), setting up a strategic innovation fund, providing funds for venture capital, and investing in trade supportive industry (something we've been advocating for for quite some time).The Budget also provides $1.8 billion over six years to expand EI training programs, and tables significant improvements for accessing global talent through the Global Skills Strategy. You can find more information on the specific policies that may impact your business here. We also applaud some of the positive steps taken to promote the agri-food sector, a crucial industry for Alberta, representing our number two export.We are also very happy to hear that our government will be addressing Canada's internal trade barriers. The trade barriers between provinces cost our economy billions of dollars each year. Simply put, they're a hidden constraint that hinders business growth. Progress on this front is a win for business.

Comment:• Canada already has innovation centers through various Universities/Colleges• It takes time to take ideas from incubation to market • Funds are available, but not to every company. Government role is not to pick winners and losers

NATURAL RESOURCES▪ 2017-2018 Budget

▪ Little support for Natural Resources

▪ Red Tape and Regulations ▪ No reduction in Red Tape/regulations

▪ Clean Tech is $50B market▪ Needs access to raw materials (Lithium, Vanadium and Rare Metals)▪ More funds for R&D which needs to available to more industries

HOUSEHOLD BUDGETS

▪ Government Carbon Tax▪ Carbon taxation will add 5-8% to goods and services sold in Canada

▪ Australia pull the carbon tax as it did little for environment but hurt the economy

▪ Government removed more tax credits▪ Transit tax credit that saved a person $450/average year on their taxes

SUMMARY▪ GDP 3.4% for 1Q17 like is not going to happen as there has been pulled

back in areas like manufacturing sales, consumer spending and Exports▪ Wages are not keeping pace with inflation

▪ Carbon Taxation will impact consumer prices which means people will spend less on consumer goods

▪ Many governments have austerity measures as part of their fiscal management cycle

▪ Business investment is weak

▪ Ontario business are making investment elsewhere due to high hydro rates

▪ Employment/job creation has been in areas like supply chain management. The goods producing sector continues to struggle to create new jobs