The possibility of a referendum on sovereignty is already costing Quebec $20 million a year, according to Finance Minister Eric Girard.
At a press conference at the National Assembly on Wednesday, Girard explained that the uncertainty surrounding the referendum is increasing Quebec’s borrowing costs by at least five basis points.
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“If our average borrowing cost this year was four per cent, it is actually 4.05 per cent given this risk premium. And since we borrow $40 billion per year, that’s $20 million per year,” he explained. “After five years, that’s $100 million, and after 10 years, that’s $200 million.”
He said he arrived at these figures after studying the differences in borrowing costs between Quebec, Ontario and British Columbia.
The Minister of Finance, who voted “no” in the last referendum, also pointed out that the federal government “spends on average more than $20 billion more than it collects in Quebec.”
Quebec receives, year in and year out, $12 billion in equalization payments per year, he pointed out.
“Sovereignty is a legitimate political project, but economically, the transition period would be extremely difficult,” the minister said.
–This report by La Presse Canadienne was translated by CityNews
