The federal government is considering the sale of some Crown assets as a way of balancing its budget and avoiding a deficit, Canada's finance minister said Thursday.

Speaking with reporters during the Conservative party's policy convention in Winnipeg, Jim Flaherty wasn't specific about which assets might be put up for grabs.

"We are going to review the corporate assets, the capital assets of the government of Canada to see whether they still perform a useful function for the Canadian people," Flaherty said.

"And if that review shows there are some assets that should be sold, then we'll go ahead with it."

The finance minister said many Canadians would be surprised to know that Toronto's CN Tower was an asset of the Canadian government.

When asked if the CN Tower was for sale, he quipped, "You wanna buy it?" quickly adding, "No, it's not for sale."

Canada is already reviewing some of its assets, including Atomic Energy of Canada Limited, which makes the Candu reactor.

Flaherty did rule out an auction of the Canadian Broadcasting Corporation, which draws $1 billion annually from the federal budget.

Public Works Minister Christian Paradis, however, cautioned that the review of assets is only in the preliminary stages.

Flaherty on Thursday warned of "more carnage to come in the U.S. housing sector [and] more financial institutions in the United States that are unlikely to survive. So we are in a difficult time."

"We have to be realistic," said Flaherty, noting that he is consulting with economists regularly as conditions around the world are likely to get worse before they get better.

"The economic situation is getting worse. It has not bottomed out."

While the economic turmoil is taking its toll around the globe, however, Flaherty suggested Canada may yet avoid a deficit.

He said the government is taking steps to balance the books, including limiting public sector wage growth, reviewing government operating expenses, curbing growth in equalization payments to the provinces and asset sales.

He noted, however, it wouldn't make moves that could hurt the "real economy" for the sake of having a small surplus.

Keep spending on infrastructure

"So infrastructure spending, for example: we're going to continue all of our spending on infrastructure, because it generates jobs and Canada needs the infrastructure."

Flaherty is expected to deliver an economic update before the end of the month.

The finance minister delivered his grim economic prognosis as the Organization for Economic Co-operation and Development issued a forecast predicting that the world's most developed economies are going to continue to contract over the next year.

"The OECD area economy appears to have entered recession," Jorgen Elmeskov, director of the policy studies branch and economics department, said Thursday.

Gross domestic product is likely to decline by 0.3 per cent in 2009 for its 30 member countries, said the Paris-based organization.

It is the first time the organization has seen an aggregate shrinkage in its members' economies since it started keeping records in 1970.

With files from the Canadian Press