Global Debt Past Capacity – Mr. Peter Hall
March 29, 2023
An excerpt from “Is Economic Chaos our New Reality? Reflections on growth and hope in an unsettled world”
Mr. Peter Hall, CEO – econosphere, inc.
Transcript: Global Debt Past Capacity
The COVID period of time–like for many economies–was very expensive for Canada. So we went from a debt to GDP ratio that was somewhere between 80 and 90%. And according to the OECD, we’re somewhere between 110 and 120%.
Now ratings agencies used to look at 100% as being a pass-fail mark. And so go over that threshold and your credit rating would be at risk. And of course, this happened to Canada back in the early 1990s. We didn’t even get to the 100% debt to GDP threshold, but we were moving quickly towards that threshold and we lost our AAA credit rating at that time. So we’re above that threshold now. So that’s one key observation about that.
Has that put Canada at risk? Now, the only reason that Canada is not being singled out here, is that the COVID period of time of course, caused all of our fiscal deficits to rise and our accumulated debt to rise as a share of GDP.
So the whole world is dealing with this. And that should be comforting, because if we’ve all moved beyond a threshold that ratings agencies were not comfortable with, then collectively, we’re all in a bad situation.
Peter Hall, CEO – econosphere inc.
Peter Hall is CEO of econosphere inc., a boutique business strategy advisory firm. In this capacity he is involved in advising leading Canadian industry associations and corporations, advising and promoting international initiatives and conducting ad hoc project work. Mr. Hall is a special advisor to both Martinrea International and Elevate Export Finance, writes a weekly column in the Financial Post and is a featured speaker at conferences across Canada.
Until recently he was chief economist at Export Development Canada, heading up a large team of economists and country risk analysts that provided comprehensive forecasting for internal and external business strategy purposes, transaction risk analysis for over 160 countries, model creation, use and maintenance and data systems support. In addition to advising EDC’s executive team and board of directors, Mr. Hall personally conducted dozens of presentations annually to a wide variety of business, government and academic audiences and was continuously sought as a conference speaker at industry events in Canada, the United States and internationally.
Mr. Hall regularly speaks at conferences and corporate events and comments on the global and Canadian economies in print media, radio and television. While at EDC, he authored the widely-circulated Weekly Commentary. Prior to his work at EDC, Mr. Hall directed the economic forecasting activities of the Conference Board of Canada. He has served as the president of the Canadian Association for Business Economics, a 600+ member organization of professional economists and also its largest local chapter, the Ottawa Economics Association. He has served on the board and as an advisor to multiple Ottawa-area charities.
Mr. Hall has degrees in Economics from the University of Toronto and Carleton University.
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