Abbotsford in The World Economy

Abbotsford is not an island. Realizing that we are part of a global community is essential to making wise decisions as a member of the City Council.

Tuesday, I attended the RBC Royal Bank’s Fall 2011 Economic Forum to hear what their Vice-President and Chief Economist, Craig Wright, had to say about the global economic recovery. I was particularly interested in hearing their economic /financial analysis and forecasts, and what that may mean for our global economy, B.C.’s financial future and the residents and businesses of the Fraser Valley. With the rise of globalization, economies that were once isolated from one another are now intertwined. What happens half way around the world often impacts what happens right here in Abbotsford.

One of the first PowerPoint slides provided a clue to the economic outlook: “it is an uncertain, uneven and underwhelming recovery”.

A general summary of my take away was that;

1. The winds of worry regarding sovereign-debt levels have once again taken center stage as many of the world economies are hit with volatilities in the market.
2. A downward revision is forecasted in global growth and there is a need for more aggressive action to avert another downturn.
3. The world’s leading Central Bankers are putting up a united front and are signaling that they are ready to provide whatever monies it takes to keep the system going, while at the same time keeping interest rates at historic lows.
4. A key factor going forward is confidence – can the world economies keep it all together?

Although the presentation was upbeat and very well done, with trends that would indicate that things are getting better, the problems in the US were deeper and the recovery weaker than had been expected.

My conclusions in looking at the financial future for Canada remain uncertain, primarily because of what is happening south of the border. As of this writing, the picture presented a more optimistic view of recovery than I think is realistic. There are investment dollars sitting on the sidelines, on both sides of the border. One has to ask the question: Why? That fact betrays an attitude of caution and uncertainty.

For Abbotsford, this likely means an ongoing need for restraint and budgetary controls. Another “boom” era may not be right around the corner. As I have promised, if elected I will seek to implement policies that protect the people of Abbotsford from increased taxes or to decreased supply of what is needed. People need to know that their money is being spent wisely. People need to be able to trust their civic leaders. To be trusted, civic leaders need to be as transparent as possible, trusting people with the good news as well as the bad news. To be trusted, our City Council needs to listen carefully, clearly identify the problems, consider the broadest number of potential solutions and then act decisively in implementation of fiscally responsible responses.