Canada PM blames global woes for shrinking economy, assails rivals

Canada's Prime Minister Stephen Harper speaks during Question Period in the House of Commons on Parliament Hill in Ottawa, Canada, June 16, 2015. REUTERS/Chris Wattie

OTTAWA (Reuters) - Canadian Prime Minister Stephen Harper went on the attack on Wednesday after the country’s central bank cut interest rates to combat a shrinking economy, with his spokesman saying Harper’s rivals cannot be trusted to govern in such difficult times.

The Bank of Canada cut its benchmark rate for the second time this year, driving the Canadian dollar to a six-year low, saying the economy had contracted in the first half of 2015.

“The global economy remains fragile and is being dragged down by forces beyond our borders such as global oil prices, the European debt crisis, and China’s economic slowdown,” Harper spokesman Stephen Lecce said in a statement.

A sputtering economy creates a challenge for Harper, who faces an October election. His Conservative Party campaigned successfully in the three previous elections on a platform of sound economic management.

The statement said Justin Trudeau, leader of Liberal Party, would not be able to manage Canada’s economy, while Thomas Mulcair, leader of the New Democratic Party (NDP), the opposition party with the most seats in Parliament, would offer “high tax, high debt policies”.

Trudeau’s press secretary, Cameron Ahmad, said the shrinking economy and rate cut were indicative of Harper’s record, arguing in an email that the “Bank of Canada confirmed what Canadians have known for a long time: Stephen Harper’s plan has failed, and the economy is not working for middle class Canadians.”

Guy Caron, deputy finance critic for the NDP, dismissed the statement from Harper’s office as a partisan attack.

“It is not very surprising. This is a government that refuses to take responsibility for anything,” Caron said. “Instead of acknowledging the (economic) situation they try to find someone and something to blame.”

Reporting by Allison Lampert; editing by Jeffrey Hodgson, Meredith Mazzilli; and Peter Galloway