Carney Urges Smarter Development of Natural Resources Opportunities: Carney Looks to Commodities for Export Lift
Scoffield, Heather, The Canadian Press
OTTAWA - Part of the solution to Canada's poor export performance lies with natural resources, but simply pumping oil out the door won't suffice, says the governor of the Bank of Canada.
Mark Carney recently chastised Canadian business for being trade laggards since the 2008 recession, saying they have not done enough to infiltrate growing markets.
Carney said opportunities in natural resources abound in Canada, but they need to be developed quickly, efficiently -- and sustainably.
"These opportunities exist at a time when there are other opportunities in other jurisdictions, other countries. So there is an element of competition here, and we need to be appropriately efficient in their development," Carney said in an interview with The Canadian Press.
Canadian business should count on commodities prices and the Canadian dollar staying relatively strong over the long term and calculate their costs and revenues accordingly, he said.
"The scale of the natural resources opportunities are huge (and) should be developed in a sustainable way," he stressed, opting to use the "sustainable" word at a time when the Conservative government shies away from it. Prime Minister Stephen Harper's pre-budget directives dropped the notion of sustainable development and replaced it with "responsible" exploitation of resources.
But to make the most of a global economy with high commodity prices, the natural resource industry needs to look at ways to make sure it is being paid global rates for its products, Carney said.
For now, producers in the West are being paid less than consumers in the East are paying, because Western oil and gas don't flow all the way to the east.
With the right investments in infrastructure and pipelines, those differences could be reduced to everyone's advantage.
"Building actual energy infrastructure which would get rid of these differentials," Carney said.
Emerging markets are begging for technology and products that allow for a more efficient use of energy and Canada should be eyeing those markets, he advised.
"The marginal demand for commodities -- it's not the United States any more. It hasn't been for a while and it's never going to be again. I don't think it ever will be again in our professional lifetime."
Entering into long-term contracts with customers will also help Canadian exporters mitigate the risks of volatile prices, he added. …