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Finance minister teases ‘clean economy’ investments in Canada budget

OTTAWA (AFP) – Canadian Finance Minister Chrystia Freeland said on Monday the federal budget, to be released next week, will include big investments in the “clean economy”, to narrow a gap with massive United States (US) subsidies.

Speaking to reporters ahead of the March 28 release of the federal budget, Freeland said to expect “serious investments” in this sector. “We will invest in building Canada’s clean economy,” she said, adding that the “investments are going to be smart (and) they are going to be strategic”.

The minister did not provide specifics, but Ottawa has been wooing investment in advanced lithium-ion batteries manufacturing for electric vehicles and critical minerals mining.

Last week, German auto giant Volkswagen announced it was building its first North American battery factory in St Thomas, Ontario. Stellantis and LG Energy Solution have also partnered on a new battery plant in Canada.

“From clean energy to clean technology, to battery manufacturing, to electric vehicles, we can and we are becoming a global leader in the growing clean economy,” Freeland said, pointing to Canada’s abundance of hydroelectricity and critical minerals.

Green technology production has taken on greater urgency after the US unveiled a USD370 billion programme of tax credits and subsidies for electric vehicles, batteries and renewable energy projects – if they are US-made. The clean technology sector is expected to be worth EUR600 billion (USD630 billion) worldwide by 2030, more than three times the current level.

Freeland said the federal budget would also highlight billions of dollars recently announced for healthcare, and “targetted inflation relief” for Canadians struggling with rising prices.

Otherwise, she said, to expect no frills. “In our budget, we will exercise fiscal restraint.”