Canada can teach Europe a debt lesson – UAE newspaper General August 18, 20120 Abu Dhabi: A UAE newspaper wondered how Merkel and Europe must envy Canada’s fiscal prudence. In an editorial written on the backdrop of German Chancellor Angela Merkel’s Canadian tour, Gulf News said: In Europe, Merkel leaves a continent struggling for the past three years to effectively control its finances, roll back governments’ spending and strengthen the euro. While she has long been the voice of sound fiscal planning and the headmistress who tries to maintain financial discipline in the unruly class of 17 Eurozone members, she must surely envy the position of Canada at present. “The difference between Canada and Europe is one of day and night, light and darkness, sound finances, not reckless borrowing, budgetary controls, not sovereign bailouts”, said the paper. While Canada has been sideswiped by the global financial crisis of the past three years, it has emerged relatively unscathed compared to other members of the G20 economic club. Why? Because of sound financial decisions it made over the past two decades, it noted. In 1994, then prime minister Jean Chretien slashed government spending, eliminated thousands of public sector jobs and laid the groundwork for lowering the federal government’s national deficit. Through boom times, Ottawa resisted the urge, mostly, to restore those cuts, and paid down its national debt in successive years, added the paper. At the same time, Ottawa maintained a tight regulatory control on its banks sector, refusing to liberalise the sector, declining mergers unless they were in the interests of the nation as a whole. Canada also tightly regulated it mortgage market, ensuring home purchases were based on real money, not paperless assets. Its companies increased productivity, embraced innovation, looked to emerging markets for new opportunities; the paper explained. How Merkel and Europe must envy Canada’s fiscal prudence, wondered the paper.