GDP slump eases to 0.1 per cent in February: Statscan
Canada’s economy kept shrinking in February, but the rate of deterioration slowed sharply. The 0.1 per cent GDP drop for February followed downward jolts of 0.7 per cent in January, one per cent in December and 0.7 per cent in November. Since last November, the Canadian economy has lost about 360,000 jobs and the unemployment rate has hit eight per cent. More job losses and higher unemployment are expected this year before an expected recovery in 2010. While Statistics Canada reported Thursday that the country’s total economic output was down 2.3 per cent from February 2008, the decelerating devastation prompted some optimism. “Following an incredibly intense three-month plunge in Canadian output from November to January, the mild February decline seems like a relief — a version of ‘been down so long, it feels like up’ to the economy,” commented BMO Capital Markets economist Douglas Porter.
Canadian oil sands trust to convert to corporation
Canadian Oil Sands Trust (TSX:COS.UN), which owns the biggest stake in the world’s top oilsands venture, the Syncrude project, says it will likely convert into a corporation before new rules governing trusts come into effect in 2011. In its financial report, the energy trust said that in the first quarter legislation for the conversion of income and royalty trusts into corporations was enacted, allowing income and royalty trusts to convert into public corporations without triggering negative tax implications for unitholders. “Based on current information, Canadian Oil Sands will likely convert into a corporation,” the oilsands company said. “However, we plan to retain the flow-through tax attributes of a trust structure until 2011 unless circumstances arise that favour a faster transition.”