Canada's economic prospects for 1980 are dismal. High unemployment, strong inflation and little or no real economic growth are being predicted widely.
If there are any bright spots they are in corporate capital spending and the energy field. Business spending is expected to help moderate the economic downturn while oil and gas are bolstering the booming western provinces.
But all in all, there is nothing to cheer about in the predictions of economists, banks or the federal government.
Canada's major trading partner is the United States, and its economy is linked inexorably to that of its giant southern neighbor.
A dozen recent predictions for Canada suggest that growth, excluding the effects of inflation, is just over one percent. That would be less than half the modest real expansion of production in the past year. Predictions range from a slight decline to a 2 percent real gain.
Last month, federal Finance Minister John Crosbie predicted an overall rise of one percent in real growth for this year.
In examining the trend, the closer the forecasters got to the end of the year, the more pessimistic they became. Growth rate predictions made in the spring and early summer averaged more than 3 percent for this year. Earlier forcasts included a few predictions of a 6 percent boom in 1980. But recent predictions of consumer price inflation averaged more than 9 percent, about the same as in 1979.
There also has been a steady worsening in this view with energy costs and metal prices moving relentlessly higher. The predictions for unemployment this year have tended to get a little better with the recent average forecast suggesting an 8.3 percent rate.
The unemployment rate is historically high and worse than the 7 1/2 percent rate for 1979. The reason the forecasters are less gloomy is that unemployment in 1979 wasn't as bad as expected.
Figures released last week by the government show a trade surplus of $3.2 billion for the first 11 months of 1979. A record trade surplus of $3.5 billion was recorded in 1978.
November automotive products exports, sold mainly to the U.S. market, fell by 21 percent to $829 million. Truck and other motor vehicle exports fell by 47 percent in the latest month. The November trade surplus was $528 million, the second largest in 1979, largely because the value of imports dropped more than exports.
And a sluggish U.S. economy promises little help in this area.
One of Canada's major banks, the Toronto Dominion, predicts a huge jump in Canada's current account deficit to $8 billion from $6.5 billion in 1979.
"Canada must attract more than $8 billion in long- and short-term capital inflows in 1980 if this country's foreign exchange reserves are not to be depleted," the bank says.
But it suggests lower U.S. interest rates and an improved merchandise trade position could move the Canadian dollar higher in the latter half of the year.
The Canadian dollar, currently trading at less than 86 cents in U.S. funds, is helping Canadian exporters. The bank suggests that after some weakness in the early months of the year, the dollar could move up to about 88 cents U.S. during the second half.
Consumer spending is expected to increase about 2 percent in real terms compared with rises of 3 percent in the preceding two years. Weak spots are expected to include automobiles and appliances.
Consumers will be restricted by a lack of real gain in incomes, with wage increases averaging about 9 1/2 percent, about the same rate as inflation.
The 9 1/2 percent inflation figure does not take into effect an 18-cent-a-gallon federal excise tax proposed by Crosbie in his December budget. The government was defeated onthe budget and if it is returned to office next month will reintroduce the tax measures. That would raise Canada's inflation rate this year to 11 percent.