With questions swirling about the economic impact of COVID-19 in the province, Premier Dwight Ball wrote the Prime Minister nearly two weeks ago seeking serious financial help from Ottawa—or the province would not be able to continue operations.
In the letter, dated March 20th, Premier Dwight Ball indicates that Newfoundland and Labrador entered 2020 “in a difficult situation.”
He says more than 21 per cent of the province’s population is 65 or older, and 84 per cent of those have “at least one chronic disease.” That makes containing the spread of COVID-19 even more critically important according to Ball.
(VOCM File Photo.)
Premier Ball tells Prime Minister Trudeau that Newfoundland and Labrador never fully recovered from the 2015-16 downturn in the economy when royalty revenues declined by over $1-billion.
That, in addition to #Snowmageddon and the subsequent State of Emergency, the collapse of oil prices, and the anticipated impact of COVID-19 have left the province in an unprecedented situation.
“Newfoundland and Labrador is a small, resource-based economy with exports accounting for 60% of its GDP. A global recession will lower demand for the province’s key exports of fish, oil, newsprint, and minerals, and will significantly impact production, employment, and income levels in those industries. Oil prices have plummeted to historic lows and construction activity on Muskrat Falls and the Vale underground mine has been suspended. The fishery, which is the backbone of our rural employment, faces a very uncertain season. The immediate impacts on air transportation, accommodations, food and beverage establishments, and recreation facilities as a result of social distancing measures being implemented are also unprecedented”
-Excerpt from letter
Premier Ball says the province is facing an “immediate and urgent financial crisis,” with no success in its attempts to borrow money in both the short and long-term. He tells the Prime Minister that the province has “no other recourse to raise the necessary funds to maintain the operations of government”, including the health care system.
He says the province’s situation is driven by our lack of fiscal capacity before the crisis, compounded by the collapse of oil prices and the pandemic.
Newfoundland and Labrador, Ball concludes, “has run out of time.”
