Toronto, Ontario – Prime Minister Stephen Harper’s announcement of additional financial support for the auto and aerospace industries is a “desperate act” that will make little difference to Canada’s manufacturing sector, according to Ken Lewenza, president of the Canadian Auto Workers Union (CAW).
Harper has pledged to expand support for the federal Automotive Innovation Fund by $50 million per year, and for the Strategic Aerospace and Defense Initiative by $50 million per year, each for four years. He also pledged to unilaterally eliminate tariffs on imports of machinery and equipment used by manufacturers.
“Mr. Harper is more concerned with his party’s crisis in the opinion polls, than the economic crisis in Canada’s manufacturing communities,” Lewenza said. “This new program, announced just a week before the election, will not significantly relieve the catastrophe of job loss being experienced across our manufacturing belt.”
The CAW said that Canada’s auto industry has lost almost 30,000 jobs since peaking in 2002, with almost 20,000 of them disappearing since Harper’s election in January 2006.
CAW economist Jim Stanford said that the announced tariff reductions will have no meaningful effect on investment decisions. “Canada imports almost $100 billion per year in machinery, computers, and electrical and electronic equipment,” he said. “Tariff savings of $345 million will make no visible difference to that cost. Indeed, a one-cent change in the value of the Canadian dollar will have more impact than this tariff.”