‘Oilsands Fever’ Seen as Canada’s Dutch Disease
On the eve of NDP Leader Tom Mulcair’s visit to Alberta’s oilsands, a new report backs his claim that Canada’s economy suffers from a form of Dutch Disease.
A study released Wednesday by the Pembina Institute says Canada has come down with a unique strain of the phenomenon, dubbed “oilsands fever,” that is producing near-term economic benefits that are often overstated.
The report says these benefits are spread unevenly across the country and could be hiding economic turmoil down the road.
But another report by a different group says Canada’s oil and gas industry is spreading the wealth by using the money earned from booming exports to buy goods and services from the rest of the country.
The two reports were released simultaneously as Mulcair embarked on his first tour of the oilsands.
The NDP chief has been lambasted by western premiers and the federal Conservatives for suggesting oil exports raise the value of the Canadian dollar, which in turn hurts the economy in other parts of the country.
The phenomenon is dubbed the “Dutch Disease,” in reference to the manufacturing decline that occurred in the Netherlands after a boom in natural gas exports in the 1970s.