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Canada’s finance minister unveiled a modest annual budget on Wednesday, reflecting heightened uncertainty in Ottawa as policymakers await cues from Donald Trump’s administration on tax reform and trade tariffs.

The government said it would spend only C$1.3bn more across government this fiscal year, compared to a hike of nearly C$15bn a year ago, with additions reflecting tweaks to last year’s framework rather than any sweeping changes.

The budget did not raise defence spending for 2017, despite pressure from Washington for Canada to pay more towards global military alliances like Nato.

Bill Morneau, finance minister, instead emphasised programmes to lift Canada’s middle class and support the country’s technology community, committing C$950m in the next five years towards innovation “super-clusters”.

The government forecasts a C$28.5bn deficit in the upcoming fiscal year, from C$23bn this year. Spending is projected to pick up, reaching about C$8bn annually by 2021.

Justin Trudeau’s Liberals have extolled a fiscal stimulus strategy to kickstart Canada’s economy, which the prime minister inherited during a crash in the oil price and economic slowdown. His government has exceeded campaign promises for debt levels, and today’s update did not offer any plans to balance Canada’s books.

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