Liberal Leader Stéphane Dion said Thursday that Canada must develop long-term economic policies with a focus on emerging markets to make sure the country remains competitive in the world.

Dion told the Canadian Club in Ottawa that a Liberal government would lower income taxes and make business taxes more fair, but it would not cut the GST further.

"The world does not owe Canada a living," he said. "Canada's future success — economic as well as environmental — calls for a comprehensive strategy, not a sudden, last-minute attempt to prepare for an election."

Under a Liberal government, long-term economic planning would include a three-pronged approach of competitive taxes, aggressive international trade and massive investment in innovation and education, he said.

Such an approach would get the country back on track, Dion said.

Last year was a wasted year, he said, because the Harper government cut the GST, closed consulates, cancelled trade missions and slashed funding for research, development and post-secondary education. These moves are taking Canada in the wrong direction, he said.

The Harper government has cut the GST to six per cent. It has promised to cut it by another point.

"As Prime Minister, I would govern for the long term. I would adopt policies because they are right, not just for the Canada of today, but also the Canada of the future — for a healthy planet, for social justice, for a strong economy and good jobs for ourselves, our children, and the next generation," Dion said.

A competitive tax system includes low income taxes, fair business taxes, and tax incentives for energy efficiency, he said. It also means enhancing capital cost allowance rates to encourage businesses to continue investing in machinery and equipment, he said. 

"We have this Conservative government, willing to squander $12 billion per year, $60 billion over five years, on an unproductive two-point cut to the GST," he said.

"There is scarcely an economist on the planet who supports this approach. All have clearly said that lower income tax, not lower GST, is the right way to go."

Liberals would reverse Conservative cuts: Dion

Aggressive international trade means increasing export markets and strengthening ties with emerging markets such as China and India, doing a better job of capitalizing on the large Asian-Canadian population in Canada, and working to improve the trade relationship between Canada and the U.S., Dion said.

A massive investment in innovation and education means reversing Conservative cuts to research and development spending, post-secondary education and workplace skills training, Dion said.

"I believe Canadian taxpayers would rather take more money home on their paycheque than save a penny when they buy a cup of coffee. I believe Canadian businesses would rather find new customers in China than watch Mr. Harper close consulates and cancel trade missions. I believe Canadian researchers would rather develop the next BlackBerry here in Ontario than watch it happen in Europe or the U.S.," he said.

"And I believe Canadians everywhere would rather their government secure our prosperity for the future than spend it today on instant gratification and gimmicks."

Dion is touring the country during a two-week parliamentary break to highlight his strengths as the new Liberal leader and to build support for the party.