Monita Pesumal profiles the economy of the second-largest nation on Earth

‘Cold’ is probably the first word on anyone’s lips when they’re asked to describe Canada. The north of the country is so cold for much of the year that the ground remains frozen. But the cold is only the tip of the iceberg when describing this Commonwealth nation.

Canada’s economy has grown to be one of the most diverse in the Western hemisphere, rendering it an extremely prosperous and wealthy nation. Its economy is dominated by mining, petroleum, machinery and equipment, automobiles, metals, plastics, technology and energy derivatives, forestry, fishing and agriculture.

Technology is one of the most rapidly growing sectors in Canada. Local technology firms invested US$ 9.1 billion on innovation in 2015, making it the largest sector for R&D spending in the economy. And tech firms contribute to seven percent of the country’s GDP.

Canadian firms on the Fortune 500 global list are George Weston, Royal Bank of Canada, Alimentation Couche-Tard, Magna International, Toronto-Dominion Bank, Power Corporation of Canada, Manulife, Enbridge Gas Distribution, Bank of Nova Scotia (Scotiabank), Suncor Energy and Onex.

With many of these being in the financial services industry, it comes as no surprise that Canada is home to one of the strongest banking systems in the world. Its banks outperform their US counterparts for stability and shareholder returns thanks to a superior regulatory framework under which they fall – namely the Bank of Canada.

According to the Canadian Association of Petroleum Producers, Canada is the fifth-largest producer of natural gas, sixth-largest producer of crude oil and 11th-largest exporter of oil in the world.

With extensive oil and natural gas reserves across the land, Canada ranks third behind Venezuela and Saudi Arabia for proven oil reserves. But due to oil prices tumbling, some 44,000 employees in the oil industry have suffered job losses since the energy crisis took root in 2014.

Canada ranks among the top five nations on Earth in the production of major minerals and metals that include potash, nickel, copper, uranium, niobium, cobalt, aluminium, zinc, tungsten, iron ore, platinum, salt, sulphur, titanium, diamonds, cadmium, silver and gold.

About 375,000 people across the country are employed in the mining (which is one of the nation’s oldest sectors) and mineral-processing sectors. The Mining Association of Canada says the country has one of the largest mining supply sectors in the world with over 3,700 firms supplying engineering, geotechnical, environmental, financial and other services to mining operations.

Those who work in mining enjoy the highest wages among all industrial sectors in Canada with the average annual pay exceeding 100,000 Canadian Dollars. This easily surpasses the average earnings of workers in forestry, manufacturing, finance and construction by between 21,000 and 33,000 dollars.

It is often humorously reported that as the land of the maple leaf has 348 million hectares of forest land, they could fill all of Japan, Italy, Cambodia, Nicaragua, France, Germany, Ghana, Cameroon, Sweden, South Korea, Uruguay and the UK. Three main sectors emerge from these vast Canadian forestlands: solid wood-product manufacturing, pulp and paper-product manufacturing, and forestry and logging.

Canada is the 13th-largest exporter in the world and the United States is the recipient of 75 percent of its exports.

The neighbours share a trade agreement that spans almost three decades, and nearly 1.6 million Canadian Dollars’ worth of goods and services are exchanged between the two countries every minute! The US is also the prime destination for Canadian foreign direct investment (FDI) that is mainly in stocks.

In preparation for Donald Trump’s presidency across the border, Canada’s Prime Minister Justin Trudeau recently reshuffled his cabinet in the light of a “shifting global context.”

Chrystia Freeland is Canada’s new Minister of Foreign Affairs. She was one of 13 Canadian officials and politicians blacklisted by Moscow in 2014 in revenge for the sanctions that Canada imposed following Russia’s annexation of Crimea. Nevertheless, Trudeau praised Freeland as being an “extremely strong member of the team” who speaks fluent Russian.

Another strategic move was the appointment of John McCallum as Canada’s new ambassador to China as Canada explores the possibility of a free-trade agreement (FTA) with the Asian powerhouse. McCallum is an experienced politician who handled Canada’s immigration portfolio until recently.

But the best news for the country is that it now has the second-best quality of life in the world.

According to the 2016 Social Progress Index, Canada is one of the most socially advanced nations in the world. The index ranks 133 countries under three major categories – basic human needs, and foundations of well-being and opportunity – and lists Canada first in the ‘opportunity’ category for its social welfare policies. It is understandable therefore that Canada is a magnet for those with long-term settlement aspirations.