The Yukon may not benefit from Ottawa’s federal economic stimulus plan.
Premiers from across the country met with prime minister Stephen Harper last week to try and tailor Ottawa’s upcoming budget to their region’s needs. Regulatory overhaul and infrastructure spending were widely discussed, but such measures may not have a profound effect on the Yukon where the recession is expected to specifically impact the mining and tourism sectors.
The Yukon isn’t your regular recession victim and risks being swept under the rug if the federal government focuses only on the provinces’ needs. For starters, the territory isn’t being hit with massive manufacturing job losses; it doesn’t have on-reserve First Nations and it doesn’t have two environment bodies causing regulatory havoc.
That means most of the good news coming out of Ottawa is no news for us.
While provincial leaders and mayors made a united push for fewer environmental regulations, this doesn’t have any benefit for the Yukon because it only has one environmental assessment body, the Yukon Environmental and Socio-economic Assessment Board.
The Assembly of First Nations National Chief Phil Fontaine was “hopeful” that his -billion demand for First Nations would be met after meeting with the prime minister, but because the group only represents on-reserve aboriginals, there will be little impact in the Yukon if the Conservative government does come through.
Instead, Ottawa has to “come forward” with a federal transfer agreement for self-governing Yukon First Nations, said Premier Dennis Fentie after the meeting.
“We want Canada to conclude the unfinished business, so all 14 First Nations in Yukon have the final agreements and are self-government,” he said.
In a conference call at the end of his two-day meetings, Fentie focused on the handful of initiatives that do aim to resuscitate the economy here.
The 5 Building Canada money promised in March will be accelerated from seven years to a one- to three- year span, said Fentie.
“That’s something that may have benefit for Yukon, but at this time we’ll have to determine that,” he said.
The premier also lobbied for a deal to finish the Mayo B project, which would connect the Yukon’s two hydroelectric power grids, he said. As well, northern premiers worked on the northern economic development agency, and federal funding for the provinces and territories is being reviewed, he said.
But with one week to go before the January 27 budget, there are no details on measures to help the mining and tourism sectors.
Mining exploration companies have been hurt by a fall in commodity prices and rising loan costs. On his two-day visit to Whitehorse last week, Treasury Board President Vic Toews didn’t say if the government had any specific ideas for increasing credit for mining companies, but that his government has been asked to continue the mineral exploration tax credit that had benefitted junior mining companies in the Yukon.
The government will not interfere in the market, but will try to put verbal pressure on banks to ease credit.
“Some of it has to be moral suasion as oppose to legislated or legal mechanisms,” he said. “Some of the things we are hearing is not encouraging in terms of the availability of credit or the increase in fees.”
Major banks are adding extra fees on borrowing, he said.
“This issue with the lack of credit, or not always the lack of credit but the increased cost in credit, it seems to be something that the banks are doing on a national basis. It’s not a local thing.”
And no industry is being spared, he said.
“It’s not in respect to new industries, it’s established industries who are offering full security for the loans and, nevertheless, the cost of loans and fees are going up substantively.”
Contact James Munson at jamesm@yukon-news.com.