CANADIAN LESSONS - Canada is often referred to as the country that got it right in past years. It was not hit by the banking crisis, but at the same time it is not perfect. Canada has had a recession, and while we have supported banks, the Canadian government supported its automobile industry with taxpayers’ money.
Like Ireland, it has also introduced tax credits for Research & Development. It has removed manufacturing tariffs, and gradually is reducing taxes on business to about 25% over the next couple of years.
Canadian Finance Minister Jim Flaherty is in Dublin this week. He says part of Canada’s stable economic situation is good luck, but the key was its effective supervision of financial institutions.
He says there was no ‘chummy relationship’ with bankers and that the role of a financial regulator should be ‘adversarial’. He says, unlike Ireland, Canada did not tailor its tax system to encourage home ownership. He said his country had a tradition of fiscal conservatism, which may be boring but has provided stability.
Mr Flaherty says he does not like credit ratings agencies, adding that they are part of the problem that led to the economic crisis. Referring to Standard & Poor’s downgrading of Ireland’s rating, the Canadian minister says he would take the decision ‘with a pinch of salt’.
He says he applauds the steps the Irish government has taken to get our economy back on track.
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GUINNESS SALE DECLINE - Figures out this morning from Diageo show that net sales of Guinness fell by 5% in the financial year which ended in June. The company says that Guinness' market share though continues to grow, with 30 consecutive months of growth in Irish pubs. One in three pints bought in Ireland is a pint of Guinness.
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CURRENCIES - The euro is trading at $1. 2718 and 81.65 pence sterling.
