Governor Dodge Says Canada Must Improve Its Financial System Efficiency
Bank of Canada Governor David Dodge said today it is imperative that Canada work to enhance the efficiency of its financial system.
In a speech to a joint meeting of the Empire Club of Canada and the Canadian Club of Toronto, Governor Dodge said that future economic growth and prosperity in Canada depend on improving the efficiency of Canada's financial system, including financial markets and financial institutions. "If we don't make this effort, the Canadian economy will suffer," he said. "The status quo won't cut it."
Canada's status as a world leader in financial institution efficiency has been diminished over the past decade as other countries have forged ahead, Governor Dodge noted. In these circumstances, the Governor said that Canada faces a difficult policy challenge: "How can we enhance our policy framework to provide greater incentives for innovation by encouraging competition while, at the same time, giving our institutions the scope to improve efficiency?"
Governor Dodge also spoke about the need for Canada to implement appropriate securities regulation, given the country's large number of smaller-sized firms. "The principles at the heart of Canada's regulatory framework must be as good as, or better than, those of any other country," he said, adding that Canadian disclosure rules "should take into account differing levels of size and complexity."
The Governor stressed the urgency of moving forward in order to maintain Canada's competitiveness. "While Canada has been studying and analyzing, the rest of the world has been acting. It's time for us to act, too," he said. "The future health of our economy and the prosperity of Canadians depend on it."