Canadian Finance Minister Paul Martin must feel he's in paradise.

Relaxing yesterday in the lounge of the Southampton Princess he can't help but crow, just a little, as Canada's economy at last shows signs of shaking off one of the cruelest recessions in recent memory.

And Mr. Martin, in his third year as Finance Minister, has reason to feel bullish.

Coming in under $30 billion this year, Canada's battle with its deficit appears to be paying off. For the third year in a row -- and without dipping into a $2.2-billion contingency fund -- he has brought the deficit down ahead of schedule.

"Virtually all the indicators look promising,'' he told The Royal Gazette .

Inflation is under target; interest rates are on target; nearly 200,000 private sector jobs -- the vast majority of them full-time and permanent jobs -- have been created; and Canadian consumer confidence is finally returning.

The recovery he says, has been definitely export driven but will become more broad-based as Canadian household balance sheets improve.

As he prepares to wrap up the Commonwealth Finance Ministers Meeting Mr.

Martin, who flies to Washington tomorrow, is expected to press the International Monetary Fund and the World Bank for greater flexibility on the issue of debt restructuring for the developing nations of the Commonwealth.

On Saturday he joins forces with British Chancellor of the Exchequer Kenneth Clarke, Dr. Omar Davies of Jamaica, S.M. Kibria of Bangladesh, and Commonwealth Secretary General Chief Emeka Anyaoku in a press conference prior to the IMF/World Bank annual meetings.

The Commonwealth, says Mr. Martin, represents a mix of nearly quarter of the world's population and economies and the fact that it can arrive at a consensus is remarkable.

"This is my first Commonwealth Finance Minister's meeting and I was impressed with the quality of debate and the efforts of the Bermudian Government,'' he said. "There has been a strong consensus on the multi-lateral debt issue.

There was discussion on the need for a number of structural changes for smaller countries and a number of us reiterated our positions on the sale of IMF gold (reserves).'' A proposal for the IMF to sell some of its gold and put the proceeds towards debt relief for developing nations promises to be one of the more controversial issues confronting the IMF meeting.

"It's hard to say what will come out of Washington next week. Canada's position is -- to a certain extent -- gold is a sterile asset. It doesn't earn interest. We would like to see them sell a small amount and use the interest to help the poorest of the poor,'' he said.

Canada, Britain, and the US are "fairly united on this front''.

"What's important is that those who oppose gold sales should come up with a better alternative. All the G7 countries are concerned with the debt issue,'' he said.