GDP ANALYSIS OF CANADA

STATISTICS:
 Currency: Canadian Dollar

 Fiscal Year: 1 April – 29 March

 GDP (2019): 1.820 Trillion (Nominal), 1.931 Trillion (PPP)

 Rank: 10TH Nominal, 16TH PPP

 GDP Growth: 1.8% 2018

 GDP per Capita: 48601$ Nominal, 51546$ PPP

 GDP by sector
agriculture: 1.6%, industry: 27.7%, services: 70.7% (2016 est.)

 Labour Force: 20 Million

 Main industries: Transportation, equipment, chemicals, minerals, food,

wood and paper, fish products, petroleum natural gas.
THE CANADIAN ECONOMY:
 Canada has the seventh largest economy in the world.

 GDP: Gross Domestic Product: GDP is the value in terms of money of all
finished and unfinished goods in terms of money within the limits of a
country calculated under a specific time period. GDP can be calculated on
an annual as well as quarterly basis depending on the country’s economic
set-up.

 Canada has most of its business that is owned by the private sector with
limited state control in matters of business like healthcare, transportation
and utility.

 Following a mixed economy pattern (An economic system where the

concept of private market exists with some degree of state monopoly over
the market), Canada has shown excellent economic standards in terms of
its GDP.

 Canada’s GDP figures (Canadian economic accounts) are calculated by

Statistics Canada based on the Canadian System of Macroeconomic
Accounts (CSMA)

 Canada uses it’s mixed economy set-up in a highly developmental light

and that has resulted in it being the 10th Largest GDP based Country in
the world today.

 Major factors that contribute to its GDP are its tremendous natural
resource reserve in terms of coal and petroleum which often makes
Canada being referred to as the energy superpower of the globe.

 Its various manufacturing industries ranging from seafood, automobile,

aircraft, software etch also play a pivotal role in shaping the economy and
hence the overall boosting GDP of the country.

 Canada has its membership alliance with economic agencies like Asia
Pacific Economic Cooperation, North American Free Trade Agreement,
G7, Organisation for Economic Cooperation and Development, G20 and
World Trade Organisation
AMERICAN IMPACT ON CANADIAN ECONOMY:

 Foreign trade contributes the most to the country’s GDP.

 United States of America is the largest contributor to the country’s

foreign trade.

 Free trade and elimination of tariff between the two countries has led on
to both the country achieving success in their economy from net export
and import.

 Foreign trade sums up to 45% of the country’s GDP.

 To put things into perspective, each day 1 Billion US dollar worth of

good crosses the US-Canadian Border.

 Canadian and American economies are very similar contrary to the fact
that it’s smaller in comparison to American Economy.

 Canadian economy just like American Economy has a high rate of

Disposable Income.

 Canadian workers also receive more and higher wages as compared to

workers from the rest of the world.

 These factors of higher wage and higher disposable income results in the
Canadian workers spending more on purchase of goods which results in
increase of production and new types of product.

 This above cycle of wage income and expenditure results in a stabilised

and highly developing economy. It also results in creation of better
paying jobs.

 Advertising plays a major role in both the country’s economy.

 Television is the major source of advertising in both the countries.

GDP OF CANADA IN YEAR-2015:
 0.7% Growth in Canada’s GDP in the year 2015.

 The GDP Figure in 2015 was $1559623 million.

 It was ranked the 10th in the GDP Ranking that year.

 The GDP rose by $239,648 million as compared to year 2014.

 The GDP per Capita was $43560 million.

 The GDP per Capita increased by $7142 million. as compared to 2014.

 It showed a higher living standard position by being place at 18th rank in

the Index.

 Household spending on durable, semi-durable and non-durable goods all

increased. Outlays on services were also higher.

 Lower business gross fixed capital formation was driven by a decrease in

investment in non-residential structures (-0.5%) and machinery and
equipment (-0.8%).

 Exports of goods and services fell 0.4% after increasing 2.2% in the
previous quarter. Exports of goods were lower, while those of services
were higher. Imports were up 0.4%.

 Most major industrial sectors increased production in the fourth quarter.

The value added of service industries rose 0.6%, while that of goods-
producing industries increased 0.5%.
GDP OF CANADA IN YEAR 2016:
 The GDP Growth was 1.1% as compared to 2015.

 The amount of GDP was $1,535,768 million.

 The Rank was 10th in the 196 Country List.

 The GDP dropped by $23800 million as compared to 2015.

 The GDP per capita was $42418 million.

 The GDP per capita decreased by $1412 million.

 The Standard of Living Rank dropped to 20th this year.

 Food and Beverages industry contributed significantly to the economy.

 Construction work on ground level contributed the most to the

underground economy.

 Low level oil prices and exports to USA made the GDP stable this year

 Underground economic activity in Canada totalled $51.6 billion in 2016,

or 2.5% of gross domestic product (GDP).

 Underground economy is a significant reason for downfall in Canadian

Economy.
BIGGEST INDUSTRIES IN CANADIAN ECONOMY AND THEIR
CONTRIBUTION TO GDP BY 2017-18:
 Service Industry contributes the highest to Canadian GDP by 70 %.

 It is also a major source of employment employing over 12% Canadians

in the retail sector.

 Second Rank is bestowed upon the business sector services ranging from
finance and communication.

 Increased demand for this sector has led to a higher development of this
industry since past few years.

 The two of the largest sectors are education and healthcare but they are
under the government dominance.

 Healthcare has experienced significant growth over the past decade and is
currently the third largest sector in the country.

 Tourism also ranks as a vital component of the Canadian service industry.

The fastest-growing aspect of Canada’s tourism sector is casino gaming
which as of 2001 had employed 41,000 people and was churning out $5
billion for the government annually.

 Energy is a major player in Canada’s economy so much so that its even

called the energy superpower of the world.

 The net energy products exports in the country accounted for about 2.9%
of the GDP in 2009.

 Canada holds vast oil and gas reserves that are concentrated in the
Northern Territories, Alberta, and British Columbia.

 The oil sands of Athabasca put Canada at third in size of global oil
reserves after Venezuela and Saudi Arabia.

 Hydroelectric power is a common and inexpensive source of energy in

the country. The availability of cheap energy has enabled the growth and
 development of several crucial industries such as the aluminium
industries in Quebec and British Columbia.

 Every major country develops by transitioning from the primitive

agriculture sector to manufacturing sector. It’s the same with Canada. The
manufacturing Industry plays a major role in the Canadian economy.

 Manufacturing accounts for more than 10% of the Canadian GDP with
manufacturers exporting more than $350 billion worth of goods and
services every year.

 Manufacturing creates 1.7 billion full time job nationwide.

 Automobile Manufacturing along with Aircraft contribute majorly in

Central Canada.

 Canada is one of the biggest exporters of manufactured automobiles.

 Wheat and Grain exports make the agriculture sector of Canada a major
role-player in Canadian Economy.

 The government schemes and subsidies makes the agriculture sector to

flourish in Canada.

 With over 40% of forest cover, forestry is a major part of the agriculture
sector and forest product exports are a major part of Canadian Trade.

 The government regularly shows its supports to mine exploration and

spends a significant part of its budget on it making Mining a major
contributory industry to the economy.

 Essential mineral products exploited in Canada include precious metals

such as platinum, gold, and silver, base metals like nickel, copper, iron,
lead, and zinc, diamonds as well as industrial minerals such as potash,
limestone, and gypsum.

 The annual contribution of fishing to the economy is estimated at $3.8

billion.
OBSTACLES TO CANADA’S ECONOMY AND GDP GROWTH:

 All the countries faced economic hindrances in the past few years, it was
the same with Canada but it’s banking sector remained unaffected by the
recession and due to its large housing sector and natural resources
reserve, it rebounded back to a stable state soon.

 The first and the major obstacle that Canada faces is internalised and
inherent to the fact that it goes on to live beyond its own strength or
means.

 Due to the lavish living standard that Canadians wants and the
government provides, it faced a deficit budget of 3.3% of its GDP.

 If this continues, it won’t be long when Canada goes back to revisit

history when its sovereign debt made its economy drown.

 The second problem is the lack of an economic slack. Due to which the
output gap in the economy is -1%.

 The unemployment rate though seems smaller at 5%, is still a major

hindrance to developing economy.

 The industry fails to meet the demand of the citizens and supply of labour
due to the laidback nature of economy in Canada.

 Business or Capital Investment in Canada has been another major

problem.

 The capital expenditure statistics are very low as compared to other

economies which has led to decrease in the Corporate Profit in the last
few economic analysis or fiscal years of the country.

 While other countries are doing their best to emancipate and accelerate
their economies, Canada moves forward at a sluggish rate with a Snail’s
pace because of the weight of the above problems tied to the feet of its
economy.
STEPS THAT CAN BE TAKEN TO IMPROVE THE GDP OR
ECONOMY:

 Diversification of Trade with USA being the major trade partner as well
as initiating trade with other countries can be a major step towards
presenting a better picture of Canada in the globe as well as stitch the
scars in its economy.

 The business expenditure or capital spent on business should be improved

manifold. This can be done by attracting foreign investors from various
parts by properly using the mines and mineral reserves that it holds.

 The fact that the government still holds two major sectors: Education and
Healthcare, detriments the private sector by limiting two huge options
and hence by privatisation of both these sectors, a higher GDP can be
achieved.

 Brain Drain to other countries like USA can be stopped by creating

entrepreneurial opportunities in the country itself which would also
decrease the level of unemployment.

 Canada boasts a huge coastline, which if used properly by the fishing

industry: both recreational and commercial, the country can achieve a
major economic boost.

 The advertising industry can be efficiently used.

 Immigration policies should be loosened to attract foreign labour and

brain to diversify the economy.

 Canada is rich in energy producing minerals like Uranium and many

countries at present face an energy crisis, hence cross country mineral and
mine exploration can be used as a tactic.

 The tourism industry is a vast one in Canada but it hasn’t been able to use
it efficiently. Tourism regulations and visa duties can be loosened.
CONCLUSION:
Even though Canada is a country with a stable mixed economy at the present, a
bit more diversification can help it in the long run. Privatisation of government
monopoly-held sectors can be a first step. It has a major risk of running into
inflation due to it not being able to meet the demand of its prospective citizenry.
It has failed to utilise the vast amount of resources in a meticulous way. If Canada
shifts its focus from show biz and shifts it to its economic policies, it would
receive a higher outpour. The present government has been doing an efficient job
in maintaining the track record well. Hope it continues to take steps to prevent
the economy from drowning.

BIBLIOGRAPHY:

 https://international.gc.ca/world-monde/assets/pdfs/Canada-2017-
Hamburg-Growth-Strategy_eng.pdf visited on 20.02.2019

 https://www.pwc.com/ca/en/services/deals/whats-the-deal-blog/2016-
12-new-challenges-for-the-canadian-economy.html visited on
20.02.2019

 https://www.focus-economics.com/countries/canada visited on
20.02.2019

 Statistics from: https://countryeconomy.com/gdp/canada?year=2016

visited on 20.02.2019
 CONTENTS
 GDP ANALYSIS OF CANADA

 THE CANADIAN ECONOMY

 THE AMERICAN IMPACT

 ECONOMY AND GDP IN YEAR 2015

 ECONOMY AND GDP IN YEAR 2016

 INDUSTRIES AND THEIR CONTRIBUTIONS

 PROBLEMS FACED BY THE GDP GROWTH

 POSSIBLE SOLUTIONS

 CONCLUSION

 BIBLIOGRAPHY
MACRO-ECONOMICS ASSIGMENT
INTERNAL EXAMINATIONS

TOPIC: GDP ANALYSIS OF CANADA

KIIT SCHOOL OF LAW

Submitted by:
Arya Senapati
B.A.LLB (B), 1883160

Submitted to:
Mrs. Snigdha Sarkar,
Faculty, Economics, KiiT School of Law