Canada: An Economy You Can Count On
Canada's economic strength and resiliency continue to win high acclaim around the world.
Location Canada 2012
The World Bank Group agrees: it ranked Canada No. 1 in the G-7 and countries of the Organization for Economic Co-operation and Development (OECD) for the lowest number of procedures required to establish a new business. Further, according to an October 2011 study by Ernst & Young, "Canada also leads in [lowest] start-up costs and ease of business registry, as it only takes one procedure and on average five days to start a business, while the average cost comes in at only 0.4 percent of per capita income."
These unanimous statements reflect what a good business climate, low taxes, and a hard-working, proactive government can accomplish. The biggest factor for any company that wants to expand or relocate is business cost - low costs are essential for competing in global markets, operating on thinner margins, and dealing with large-scale economic challenges, like recessions. This is where companies especially value the backing of a strong government that listens to industry, responds quickly to market conditions, and provides as many economic opportunities as possible.
Being able to provide this business climate starts with fiscal responsibility. With a total government net debt-to-GDP ratio of about 32 percent in 2010, Canada's debt burden is considerably lower than Germany's, the next-closest G-7 country. In fact, Canada's net debt burden is projected to increase by less than 1 percent in the next four years. By 2016 the International Monetary Fund expects Canada's net debt-to-GDP ratio to stand at 33 percent, compared to 86 percent for the United States. Add to this solid economic foundation low corporate tax rates, generous R&D tax incentives, and a duty-free manufacturing tariff regime, and it's easy to see why Canada attracts billions of dollars in foreign direct investment every year.
Canada also has a talented and highly skilled work force to make it all happen. Canada attracts some of the best talent from around the world, thanks to its business-friendly immigration policy for highly qualified immigrants. The OECD scores Canada first for higher education achievement - more than half of all Canadians 25-35 in age have some level of postsecondary education. And Canada's universities and colleges provide an abundance of highly qualified scientists, engineers, and business/management graduates for Canada's fast-growing industries.
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As members of NAFTA, Canada, Mexico, and the United States have access to more than 450 million consumers and a combined GDP of more than US$17.1 trillion - the most lucrative market in the world. These three countries are connected by sophisticated, well-maintained transportation systems that are integrated with modern, high-tech intermodal centers.
The United States is Canada's number-one trading partner. Seventeen of Canada's 20 largest cities are within 100 miles of the U.S. border, including many Canadian plants and factories. More than $1.7 billion in trade crosses the Canada-U.S. border daily, expedited by a "smart border" that relies on technology to speed the flow of goods - including automated permit ports, transponder identification systems, and joint processing centers.
Canada also continues to strengthen its trade relationships with Asia-Pacific markets and European centers by investing in its Asia-Pacific Gateway and Atlantic Gateway initiatives. These programs are spending billions of dollars to upgrade the trans-Canada transportation infrastructure that connects the nation's world-class eastern and western ports. This results in leaner and more efficient global supply chains, which also improve speed to market.
Unmatched in Innovation
Canada is always moving forward - from developing its vast natural resources with new technologies to supporting state-of-the-art research across all its industrial sectors, keeping Canada at the forefront of innovation. Key sectors include aerospace, agriculture, electronics, biotechnology, food products, automotive, life sciences, medical devices, sustainable energy, chemicals, plastics, new media, and information and communications technology (ICT).
Canada continues to explore new ways to develop alternative energy sources. The federal government recently launched its $97 million ecoENERGY Innovation Initiative, which supports research and development for promising clean-energy technologies in the fields of energy efficiency, clean electricity, bio-energy, electric transportation, and unconventional oil and gas sources.
Calgary is the headquarters center for Canada's energy industry and a leader in alternative energy research. According to the Conference Board of Canada, over the next five years more money ($6.1 billion) will be invested in climate-friendly technology in Alberta than in all other Canadian provinces combined. This includes Alberta's $150 million Bio-Energy Plan, which expects to leverage an additional $2 billion in private investment to commercialize technologies in wind, geothermal, gasification, solar, and waste and biomass conversion.
Aerospace is another key growth market in Canada. With more than 400 aerospace manufacturing and services companies, Canada ranks fifth in the world for aerospace related activity. It supplies one third of global demand for small gas-turbine engines and controls 70 percent of the global market for visual simulators. According to a 2011 RNCOS research report, Canada's aerospace market has experienced one of the fastest growth rates in the world over the last few years.
Additionally, in October 2010 the Global Aerospace Center for Icing and Environmental Research (GLACIER) opened in Thompson, Manitoba. This $42 million research and testing facility was developed by Pratt & Whitney Canada with the support of the Canadian and Manitoba governments.
"GLACIER will be a global leader in cold weather research for the aviation industry and is well aligned with Pratt & Whitney's long-standing focus on research, development, and innovation," said Walter Di Bartolomeo, vice president of engineering for Pratt & Whitney Canada, at the opening.
Representative of Canada's international ICT leadership role is the country's explosive growth in digital media. This sector is led by British Columbia, which is home to more than 600 digital media companies that generate a combined $2.3 billion in annual sales. Greater Vancouver accounts for more than 60 percent of the digital media companies in the province, which specialize in interactive design, digital entertainment and games, digital film, animation and special effects, mobile content and applications, and e-learning.
Vancouver supports one of the top video game clusters in the world, including leaders like EA (Electronic Arts), Nintendo, THQ, Vivendi/Activision, Disney, and Microsoft. Hollywood film producers often use Canadian-developed multimedia technology, such as Maya and Houdini software, to create special effects that routinely win Academy Awards.
Sony Pictures Imageworks plans to double its Vancouver workspace for visual effects and digital animation; the new 16,000-square-foot facility will commence work on productions including Men in Black 3, The Amazing Spider-Man, Oz, and Hotel Transylvania.
"Vancouver today is a vibrant digital production center that offers a strong talent base and significant government incentives vital to our ability to deliver exceptional quality and value to our clients," says Randy Lake, executive vice-president and general manager of Sony Pictures Imageworks.
Quality of Life
People, of course, want to live in a beautiful, comfortable location that provides affordable living and healthcare, excellent education, and an abundance of opportunities for professional and personal growth.
According to the 2011 Better Life Initiative survey by the OECD, Canada ranks second in the world for highest quality of life among industrialized nations (Australia is first). Canada scored at or near the top in the categories of housing, education, health, and life satisfaction among the 34 countries that make up the OECD.
The 2011 World Competitiveness Yearbook also indicates Canada is first among G-7 nations for general quality of life, safety, and a fair legal system. Other benefits Canadians enjoy are world-class universities, universal healthcare, good wages and benefits, low taxes, and cultural diversity. Add the spectacular, wide-open beauty and friendly cities, and Canada is one of the best places in the world to start a business or raise a family.
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