Canada's economic restart will be a difficult balancing act: C.D. Howe

Policy working group outlines principles and prerequisites to underpin 'playbook' for federal and provincial governments

Canada's economic restart will be a difficult balancing act: C.D. Howe

It’s been more than a month since the first hints of a coronavirus-driven economic crisis appeared in Canada, and both the federal government and the central bank have since stepped in decisively to support businesses and everyday Canadians whose ability to earn income has been disrupted amid shutdowns.

But even with the continuing stream of government promises of aid, many sectors of society are struggling. The pressure to reopen the economy is growing — and doing so will involve a difficult balancing act, according to a working group of economists and industry experts organized by the C.D. Howe Institute.

In a new communique, the C.D. Howe Institute Crisis Working Group on Business Continuity and Trade recommended that federal and provincial governments collaborate on “a transparent, pan-Canadian framework for staging and managing the restart of the Canadian economy.”

Drawing from an April 21 meeting of its members, the group set out some recommended guiding principles for the “playbook” of an economic restart, including:

  • Transparent pre-conditions for each stage of easing economy-wide restrictions;
  • Pan-Canadian consistency in principles, decision-making criteria and data;
  • Sector-level staging for restart based on workplace transmission risks and economic impacts;
  • Safeguarding access to essential goods and services;
  • Synchronized re-opening of enabling public services and infrastructure; and
  • Clear off-ramp for government-provided temporary income supports

“Pre-conditions for economy-wide re-opening of the economy should be based on public health expert judgment and modelling and informed by monitoring,” the group added, noting the importance of identifying acceptable risk thresholds for virus spread and health system capacity.

It emphasized that restrictions on business activities should be eased on a sector-by-sector basis, with decisions to reopen being based on:

  • Potential extent of population exposure from the activity;
  • Probability of transmission in the sector/workplace;
  • Workplace-level protocols for health and safety practices to mitigate transmission; and
  • Balance between risk tolerance and economic costs from restrictions on the activity.

“While provincial governments should continue to make decisions about local emergency measures, federal coordination can reduce fragmentation in decision-making and protocols,” the group said.

It suggested that the government should decide on appropriate pre-conditions, observe and report key public health indicators, and standardize risk-rating along with health and safety guidance for specific sectors.


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