The doc mentioned authorities officers analyzed the potential financial harm of Covid-19 through the use of the 2003 SARS outbreak as a foundation
The doc mentioned authorities officers analyzed the potential financial harm of Covid-19 through the use of the 2003 SARS outbreak as a foundation for his or her projections.
“The Division of Finance concludes that financial impacts in Canada may very well be considerably bigger than in 2003, however would nonetheless be manageable and would reverse rapidly,” mentioned the two-page memo signed by Privy Council clerk Ian Shugart, Canada’s high civil servant.
In concluding, Shugart famous a lot was nonetheless unknown in regards to the virus.
“Nonetheless, the course of the outbreak remains to be unsure and the financial impacts may very well be extra vital if the outbreak extends to the second quarter of 2020,” mentioned the memo, which added it might hold Trudeau knowledgeable of recent developments together with if the outbreak proved to be extra extreme than anticipated.
The data within the memo surfaces amid recent questions round how a lot President Donald Trump knew about Covid-19 within the early days of the outbreak and the way a lot was revealed to the general public.
On Feb. 7 — the identical day because the Trudeau briefing be aware — Trump informed Bob Woodward of The Washington Put up in an interview that the coronavirus is “extra lethal than your, , your — even your strenuous flus.”
“That is extra lethal,” Trump mentioned. “That is 5 per — , that is 5 % versus 1 % and fewer than 1 %, . So, that is lethal stuff.”
On March 19, Trump informed Woodward he needed to minimize the specter of the virus as a result of he didn’t wish to create a panic.
The Feb. 7 briefing be aware to Trudeau expressed little concern in regards to the attainable financial fallout of Covid-19 at that cut-off date.
The doc mentioned the direct impression of Covid-19, which was concentrated in China on the time, on the Canadian financial system had thus far been “minimal.” It mentioned short-term declines had been anticipated to largely reverse by means of the remainder of the 12 months.
The memo predicted the impression of the virus in China might have an effect on international development and commodity costs, which might harm Canada’s useful resource sector.
The evaluation discovered that if the outbreak was contained by the top of March it might shave as a lot as 0.eight share factors off Canadian financial development within the first quarter of 2020. For 2020 as an entire, the officers projected solely a drop of 0.1 share factors because of the anticipated rebound.
Weeks later, on March 13, Covid-19 pressured Canada’s authorities to droop Parliament, impose new restrictions on worldwide journey, delay its annual finances and pledge a fiscal emergency bundle that turned out to be the largest ever — by far. The identical day, the Financial institution of Canada abruptly lower rates of interest by 50 foundation factors in hope of weakening the anticipated financial blow.
The ensuing pandemic-driven shutdowns created an financial disaster. It put hundreds of thousands of Canadians out of labor and led to an unprecedented authorities response that rocketed the federal deficit projection for 2020-21 to C$343 billion, or 15.9 % of GDP.