World Business Press Online, OTTAWA - Bank of Canada says it's all over now. Finance minister Jim Flaherty begs to differ - it's too early to call. Conference Board of Canada says it may be over for some parts of the country. And it may be right although it's not only about economy.

Canada's recession is over, and the country is beginning reconstruction after the world financial crisis, Bank of Canada said last week, expecting the Gross Domestic Product to increase 1.3% this quarter. Earlier, it predicted a 1% contraction.

"Dramatic shift", as economists call the increase, is considered to be the result of stronger consumer and business confidence and financial conditions in general. But the Conference Board now brings its own analysis of the situation: the rebound is being spurred mainly by huge government stimulus packages (government infrastructure spending and a provincial tax cut). New Brunswick should lead the way and Manitoba and the Maritimes - Nova Scotia and Prince Edward Island - should avoid recession this year, and recovery is in sight for most of the other provinces. On the other hand, in what used to be Canada's manufacturing powerhouse, it's not over. According to the board "the situation in Ontario remains challenging there are signs that a bottom is forming in the automobile sector. Ontario's economy is forecast to rebound next year." But there's a warning too and the Board makes a grim prediction that it will take some for the provinces to return to surpluses. Tax hikes and spending cuts will be inevitable, the Board says.

Meanwhile, Prime Minister Stephen Harper, echoing his finance minister's it's-not-over-yet statement, is pushing the message that new stimulus packages are needed to recover country's economy. "There has never been a better time to renovate your home," Prime Minister Stephen Harper said to Canadians wanted them to spend more money on reconstruction of theirs houses as soon as possible, best in next 6 month. His government is offering Canadian a home renovation tax credit (even though the credit has not actually been approved by Canada's Parliament). Reconstruction of houses he said is "a way that every family can participate in our economic recovery."

But government's stimulus is again causing stir in the ranks of the liberal opposition. Liberal Leader Michael Ignatieff said it almost clearly that he changed a position he held a month ago when he made a deal with Prime Minister Stephen Harper to avoid a summer election. Now he and some members of his Liberal party seem to be tired of the conservative government and want to bring down the Harper's cabinet in the fall. All about new stimulus will be clear after. Predictably, Harper responded with warning that early election would undermine early recovery.

Miroslava Hospodarova