Invest in Canada/Investir au Canada


JULY 2016


Investment Strategy and Analysis Division, Office of the Chief Economist
Global Affairs Canada

1. Excellent Economic Fundamentals

Figure 1-1

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Real GDP Growth and Projections (%)

Source: Consensus Forecasts, June 2016, Consensus Economics Inc.

Despite the global slowdown, Canada’s economic prospects are strong, based on a consensus of forecasts.

According to Consensus Economics, Canada has been a strong performer among G7 countries in GDP growth during the 2012-15 period and is expected to remain so through 2016-17.

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Real GDP Growth and Projections (%)

Source: OECD Economic Outlook, No. 99, June 2016.

Other forecasts also highlight Canada’s relatively strong economy.

Similarly, recent OECD statistics rank Canada as a strong performer among G7 countries in terms of GDP growth from 2012-15 and during the 2016-17 forecast period.

Figure 1-3

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Real GDP Growth in G-7 Countries, 2006-2015 (%)

  • Canada: 1.7
  • Germany: 1.4
  • U.S.: 1.4
  • U.K.: 1.3
  • France: 0.9
  • E.U.: 0.7
  • Japan: 0.5
  • Italy: -0.5

Source: OECD Economic Outlook, No.99, June 2016.

And Canada leads G7 countries in long-term GDP growth.

Long-term GDP growth statistics from the OECD place Canada at the top of the G7 over the last decade.

Figure 1-4

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Employment Growth (%) 2006-2015

  • Germany: 1.17
  • Canada: 1.08
  • U.K.: 0.79
  • U.S.: 0.51
  • France: 0.33
  • Japan: 0.03
  • Italy: 0.03

Source: OECD Economic Outlook, No.99, June 2016.

Canada also has strong employment growth...

Canada has recovered more than all of the output and the jobs lost during the 2008-2009 recession.

Almost 1,380,400 more Canadians are working today than when the recession ended in June 2009 and employment is about 953,900 above the pre-recession peak recorded in October 2008. Over 80% of the positions created since June 2009 have been full-time and in high-wage industries, with nearly 80% in the private sector.

Figure 1-5

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Federal Government Budgetary Balance (% of GDP)

*Forecasts for both countries

Source Canada: The Federal Budget, Finance Canada, March 22, 2016

Source United States: United States Congressional Budget Office, March 24, 2016.

…a strong track record of fiscal responsibility…

Canada’s federal deficit, as a percentage of GDP, is projected to rise from 0.3% in 2015-16 to 1.5% in 2016-17 as a result of short-term stimulus spending, before gradually declining to 0.6% by 2019-20.

In comparison, as a percentage of GDP, the budget deficit of the United States is projected to increase from 2.9% to

Figure 1-6

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Total Government Budget Balance* 2015-17
(% of GDP | National Accounts Basis)

*Total government budget includes federal, provincial/state and municipal budgets.

Source: OECD Economic Outlook, No.99, June 2016.

…leading most other G7 countries…

Despite posting a deficit of 1.7% of its GDP in 2015, Canada’s fiscal position is still forecast to be better than most G7 countries during 2016-2017, with an overall deficit of 2.2% of GDP.

Figure 1-7

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Federal-Debt-to-GDP Ratio

* Forecasts for both countries

Source Canada: The Federal Budget, Finance Canada, March 22, 2016

Source United States: United States Congressional Budget Office, March 24, 2016.

…a declining federal debt…

Since its peak of 68.4% of GDP in 1995-96, Canada’s federal-debt-to-GDP ratio has decreased to 31.0% in 2014-15 and is expected to rise to 32.5% in 2016-17 due to short-term stimulus spending, before gradually declining to 30.9% in 2020-21.

By comparison, the debt-to-GDP ratio of the United States is forecast to continue to increase, to more than 2.5 times Canada’s debt-to-GDP ratio by 2020-21.

Figure 1-8

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General Government Net Debt 2015-16 (% of GDP)

Source: IMF Fiscal Monitor, April 2016.

…the Lowest in the G-7…

Canada had the lowest net debt-to-GDP ratio in the G-7 in 2015 and will continue to hold this standing during the 2016-2017 forecast period.

Figure 1-9

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(Year-Over-Year % Change)

Source: OECD Economic Outlook, No. 99, June 2016

…a low inflation-rate regime…

A low-inflation environment provides business certainty to investors. Canada’s inflation rate is targeted to range from 1% to 3% through 2016.

During the past five years, Canada has enjoyed relatively low inflation– averaging 1.8% compared to 2.0% for the U.S. and 1.7% for the G7 as a whole.

Figure 1-10

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Long-Term Bond Yields (%) - 2011
Long-Term Bond Yields (%) - 2012
Long-Term Bond Yields (%) - 2013
Long-Term Bond Yields (%) - 2014
Long-Term Bond Yields (%) - 2015
Long-Term Bond Yields (%) - 2016
Daily Yields (%)

Source Canada: Government of Canada 10-Year Bond: July 8, 2016

Source U.S.: U.S. Treasury, Constant Maturity 10-Year Bond: July 8, 2016

…low interest rates…

Canada’s solid fiscal situation and low inflation has led to lower interest rates.

Figure 1-11

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Legatum Prosperity Index* G-7 Ranking

  1. Canada
  2. U.S.
  3. Germany
  4. U.K.
  5. Japan
  6. France
  7. Italy

* The Legatum Prosperity Index ranks countries based on 89 variables grouped into 8 sub-indexes which are averaged using equal weights. The sub-indexes are: economy; entrepreneurship & opportunity; governance; education; health; safety & freedom: personal freedom and social capital.

Source: Legatum Institute, London, November 2015

…an overall environment of prosperity

According to the Legatum Prosperity Index*, Canada ranks 1st in the G-7 and 6th among 142 countries in terms of overall prosperity based on material wealth and personal well being.

Figure 1-12

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Social Progress Index* G-7 Ranking

  • Canada: 86.89
  • U.K.: 84.68
  • Germany: 84.04
  • Japan: 83.15
  • U.S.: 82.85
  • France: 80.82
  • Italy: 77.38

Source: The Social Progress Imperative, April 2015.

* The Index is the sum of three dimensions: Basic Human Needs, Foundations of Wellbeing, and Opportunity. Each dimension is made up of four equally weighted individual components scored on an objective scale from 0–100. This scale is determined by identifying the best and worst global performance on each indicator by any country in the last 10 years, and using these to set the maximum (100) and minimum (0) bounds.

…and a high degree of social progress.

Canada ranked first in the G-7 and sixth overall in a 133-country study measuring social progress – defined as a society’s capacity to meet the basic human needs of its citizens, establish the foundations that allow citizens and communities to enhance and sustain the quality of their lives, and create the conditions for all individuals to reach their full potential

2. A Highly Competitive Business Environment

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Business Environment of the G-7 Countries, Rank for Forecast Period 2016-2020

  1. Canada
  2. U.S.
  3. U.K.
  4. Germany
  5. France
  6. Japan
  7. Italy

Source: The Economist Intelligence Unit, July 2016

Canada is acclaimed by the EIU for its superior business climate…

Canada understands the importance of its business community and has created an environment to encourage its success.

Canada is the best country in the G7 for doing business over the next five years, according to the Economist Intelligence Unit (EIU) and it ranked third among 82 countries in the Economist Intelligence Unit’s global business rankings for the forecast period (2016-2020).

The country also ranks well for its infrastructure, market opportunities, low tax rates, and controls on foreign trade and exchange.

Figure 2-2

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Top 10 Countries in the G-20 for Business in 2015

  1. Canada
  2. U.K.
  3. Australia
  4. Germany
  5. U.S.
  6. Japan
  7. France
  8. S. Korea
  9. Italy
  10. S. Africa

* Standing among G-20 countries. Rankings based on the following eleven categories of quantitative and qualitative indicators: trade freedom, monetary freedom, property rights, innovation, technology, red tape, investor protection, corruption, personal freedom tax burden and market performance.

Source: Forbes Publishing, December 2015.

…and more recently by Forbes.

Canada led the G-20 and stood seventh overall in Forbes latest 144-country annual study on The Best Countries for Business.

Canada ranked particularly well on a number of sub-elements, including the degree of personal freedom (first overall) and red tape involved in starting a business (second overall).


Figure 2-3

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Infrastructure Investment Index - G-7 Ranking

  1. Canada
  2. U.S.
  3. U.K.
  4. Japan
  5. Germany
  6. France
  7. Italy

Source: Global Infrastructure Investment Index, ARCADIS NV Consulting, May 2016

* Standing among 41 countries. Economic infrastructure is the core internal facility of a country than makes business activity possible, such as communication, transportation, distribution, finance and energy supply. These assets are fundamental to society and economic growth.

Canada has high potential for investment and growth in infrastructure.

Canada ranks 1st in the G-7 and 4th overall in a recent study measuring a country’s potential for investment and growth in its economic infrastructure.*

Figure 2-4

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Number of Procedures*

  • Canada: 2
  • U.K.: 4
  • France: 5
  • Italy: 5
  • OECD Average: 5
  • U.S.: 6
  • Japan: 8
  • Germany: 9

* A "procedure" is defined as any interaction of the company founder with external parties (government agencies, lawyers, auditors, notaries, etc). Interactions between company founders or company officers and employees are not considered as separate procedures. For example, an inauguration meeting where shareholders elect the directors and secretary of the company is not considered a procedure, as there are no outside parties involved.

Source: Doing Business in 2016 - The World Bank Group, 2015

Establishing a business in Canada involves relatively
few steps…

Regulations pertaining to the creation of new businesses are considerably more flexible in Canada than those in the rest of the G-7.

Canada ranks first among the G-7 and OECD countries for the lowest number of procedures required to establish a new business.

Figure 2-5

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Time Required to Start a Business (days)

  • Canada: 1.5
  • France: 4.0
  • U.K.: 4.5
  • Italy: 5.5
  • U.S.: 5.6
  • OECD Average: 8.2
  • Japan: 10.2
  • Germany: 10.5

Source: Doing Business in 2016 - The World Bank Group, 2015

…and takes relatively less time.

Canada is a G-7 leader for the fewest number of days required for establishing a new business.

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Total Tax Rate* (% of commerical profit) 2016

  • Italy: 64.8
  • France: 62.7
  • Japan: 51.3
  • Germany: 48.8
  • U.S.: 43.9
  • U.K.: 32.0
  • Canada: 21.1

Sum of profit taxes, labour taxes and other taxes.
Source: PriceWaterhouseCoopers, Paying Taxes 2016

Canada offers the lowest total tax rate on profits in the G7…

According to PriceWaterhouseCoopers’ Paying Taxes report, Canada ranks first in the G-7 and second in the G-20 for the lowest costs of all taxes borne by companies operating in the country.

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International Comparison of Statutory General Corporate Tax Rates in 2016

  • U.S.: 38.9
  • France: 34.4
  • Germany: 30.2
  • Japan: 30.0
  • Italy: 27.5
  • Canada: 26.7
  • U.K.: 20.0

Source: OECD Tax Database, May 2016


…and relatively low corporate-tax rates.

Canada has the second-lowest statutory corporate-tax rate in the G7 as of 2016.

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Percentage Cost Advantage (Disadvantage) Relative to the United States

  • Canada: 14.6
  • Italy: 10.7
  • France: 9.5
  • U.K.: 9.1
  • Germany: 7.7
  • Japan: 7.3
  • U.S.: 0.0

Source: KPMG Competitive Alternatives 2016

Canada has the lowest business costs among G7 countries…

KPMG’s Competitive Alternatives study finds Canada as having the lowest business costs among G-7 countries and a 14.6 percentage cost advantage relative to the United States.

Figure 2-9

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Percentage Cost Advantage (Disadvantage) Relative to the United States


  • Canada: 26.0
  • Italy: 16.5
  • U.K.: 14.4
  • France: 12.2
  • Japan: 11.2
  • Germany: 11.0
  • U.S.: 0.0

Research & Development

  • Canada: 27.7
  • France: 22.4
  • Italy: 21.0
  • Germany: 16.0
  • Japan: 12.8
  • U.K.: 11.9
  • U.S.: 0.0

Source: KPMG Competitive Alternatives 2016

…especially in the Digital and Research & Development Sectors

Canada is the lowest cost G-7 country in the Digital and Research & Development sectors.

Of the two industries in the Digital sector, Canada is the lowest-cost G-7 country in both the Digital Entertainment and Software Design industries.

Among the industries comprising the Research & Development sector, Canada is the lowest-cost G-7 country in all three: the Biotechnology, Product Testing industries and the Clinical Trials industry.

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Percentage Cost Advantage (Disadvantage) Relative to the United States


  • Canada: 9.7
  • Italy: 7.1
  • U.K.: 7.0
  • France: 6.5
  • Germany: 5.0
  • Japan: 5.0
  • U.S.: 0.0

Corporate Services

  • Canada: 26.1
  • Italy: 20.9
  • U.K.: 16.7
  • Germany: 16.1
  • France: 15.9
  • Japan: 15.7
  • U.S.: 0.0

Source: KPMG Competitive Alternatives 2016

Canada is also highly cost-competitive among the G-7 in the Manufacturing and Corporate Services sectors

Canada is the lowest-cost G-7 country in the Manufacturing sector and the Corporate Services sector.

Of the industries within the Manufacturing sector, Canada is the lowest-cost G-7 country in all twelve: Aerospace, Agri-Food. Automotive, Chemicals, Electronics, Green Energy, Medical Devices, Metal Components, Pharmaceuticals, Plastics, Precision Manufacturing and Telecommunications industries.

Of the 2 industries in the Corporate Services sector, Canada is the lowest-cost G-7 country in both the Professional Services and Support Services industries.

Figure 2-11

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Percentage Advantage (Disadvantage) Relative to the United States

Tax Competitiveness

  • Canada: 46.4
  • U.K.: 33.4
  • U.S.: 0.0
  • Germany: -16.3
  • Japan: -18.6
  • Italy: -35.8
  • France: -63.3

* A measure of the total taxes paid by corporations in a particular location expressed as a percentage of total taxes paid by corporations in the US.

Source: KPMG Competitive Alternatives 2014: Focus on Tax

Canada is the most tax-competitive G7 country…

Canada leads the G-7 in tax competitiveness as measured by the relative Total Tax Index* with total taxes 46.4% less than the U.S.

Figure 2-12

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Soundness of Banks* World Rank

  1. Canada
  2. Finland
  3. Australia
  4. New Zealand
  5. Singapore
  6. Norway
  7. Hong Kong
  8. South Africa
  9. Chile
  10. Qatar

* Standing among 148 countries. Ranking based on the degree of soundness of financial institutions.
Source: Global Competitiveness Report, 2015-2016

** Standing among 500 world banks based on total assets and long-term credit ratings.
Source: Global Finance Magazine, September 2015

…and has sound financial institutions.

Investors can take comfort in the fact that Canada has the soundest banking system in the G-7.

Six of the world’s 50 safest banks are in Canada, according to a recent study: Toronto Dominion Bank (10th), Royal Bank of Canada (16th), Scotiabank (27nd), Caisse Centrale Desjardins (31st), Bank of Montreal (35th) and CIBC (38th).**

3. A Dynamic Workforce

Figure 3-1

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Percentage of Individuals Aged 25-64 Having Attained Tertiary Level Education - Top 10 OECD Countries

  • Canada: 53.6
  • Israel: 48.5
  • Japan: 48.2
  • Luxembourg: 45.9
  • South Korea: 44.6
  • U.S.: 44.2
  • UK: 42.2
  • Australia: 41.9
  • Finland: 41.8
  • Norway: 41.8
  • Ireland: 41.0

Source: OECD, Education at a Glance, November 2015

Canada has one of the world’s best-educated talent pools and some of the best universities…

Canada's talent pool is the most highly educated among OECD member countries, with over half of its population aged 25-64 having attained tertiary level education.

Four Canadian universities are ranked among the top 100 in the world according to the UK-based Quacquarelli Symonds (QS) World University rankings for 2015-16: McGill University 24th; University of Toronto 34th; University of British Columbia (UBC) 50th and the University of Alberta 96th.

Figure 3-2

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Management Education Quality Index*

  • US: 7.74
  • Canada: 7.40
  • Germany: 7.03
  • UK: 6.63
  • Italy: 5.61
  • France: 4.91
  • Japan: 4.32

Source: IMD, * Rank among 61 economies considered in the World Competitiveness Yearbook 2016.

…superior management training…

ICanada stands second in the G7 in a study measuring the extent to which management education meets the needs of the business community (see chart).

In addition, five Canadian schools of management rank among the top 100 in the world according to the Financial Times (UK) Global MBA rankings for 2016: University of Toronto (Rotman) 60th, McGill University (Desautels) 85th, Western University (Ivey) 88th, Queen’s University 93rd, University of British Columbia (Sauder) 96th

Figure 3-3

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Qualified Engineers Availability Index*

  • Canada: 8.26
  • France: 7.88
  • Italy: 7.12
  • U.S.: 7.11
  • Japan: 7.01
  • U.K.: 6.18
  • Germany: 6.07

Source: IMD, * Rank among 61 economies considered in the World Competitiveness Yearbook 2016.

…and a readily available army of qualified engineers.

The availability of qualified engineers in the labour force in Canada is greater than in any other G7 country, according to a Institute for Management Development (IMD) survey.

Figure 3-4

PISA Score (points – Standing Among G-7 Countries)

United Kingdom499
United States498
United Kingdom514
United States497
United Kingdom494
United States481

Source: OECD 2012

Canada is also a world leader in academic performance among youth…

Canadian schoolchildren ranked second in the G-7 in each of three subject areas (Reading, Science and Mathematics) surveyed in the OECD Program for International Student Assessment (PISA).

Among the 65 countries and economies that participated in PISA 2012, Canadian schoolchildren ranked 9th in Reading, 10th in Science and 13th in Mathematics.

The PISA survey is conducted annually involving over 500,000 school pupils across 65 countries, and evaluates the capacity of 15-year old schoolchildren to understand and solve academic problems.

Figure 3-5

Bar Graph: Global Entrepreneurship Index* G-7 ranking
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Global Entrepreneurship Index* G-7 Ranking

  • U.S.: 86.2
  • Canada: 79.5
  • U.K.: 67.7
  • France: 66.4
  • Germany: 64.6
  • Japan: 50.6
  • Italy: 41.1

*The Global Entrepreneurship Index ranks countries based on 3 sub-indices: entrepreneurial attitudes, entrepreneurial abilities and entrepreneurial aspirations standing on 14 pillars: opportunity perception, start-up skills, risk acceptance, networking, cultural support, opportunity start-up, technology absorption, human capital, competition, product innovation, process innovation, high growth, internationalization and risk capital.

Source: Global Entrepreneurship Index 2016 – The Global Entrepreneurship and Development Institute, November 12, 2015

…and has one of the world’s best business climates for entrepreneurs.

According to the Global Entrepreneurship Index* - a measure of the health of a country’s entrepreneurship ecosystem, Canada ranks 2nd in the G-7 and 2nd among 132 countries.

Canadian policymakers are thus better equipped than most economies to implement policies leading to a productive entrepreneurial environment that will have a positive impact on innovation, productivity and job growth.

Figure 3-6

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Personal Computers Per 1,000 Inhabitants

  • U.S.: 1144
  • Germany: 1018
  • Canada: 1013
  • U.K.: 994
  • France: 985
  • Italy: 904
  • Japan: 869

Internet Users Per 1,000 Inhabitants

  • U.S.: 890
  • Canada: 884
  • Japan: 875
  • Germany: 868
  • U.K.: 843
  • France: 840
  • Italy: 824

Source: IMD, * Rank among 61 economies considered in the World Competitiveness Yearbook 2016.

Canada is a leader in computer ownership and Internet use.

Canada has a technology-savvy population and workforce. It ranks second in the G7 for the number of Internet users per-capita and third in the G7 for the number of personal computers per capita.


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Relative Generosity of R&D Tax Treatments*
(Index: Canada = 100.0)

  • France: 126.2
  • Canada: 100.0
  • Japan: 95.0
  • U.S.: 90.5
  • U.K.: 90.1
  • Germany: 81.2
  • Italy**: 81.1

* Calculations based on large firms, ** Pending new legislation proposal.

Source: Warda, Jacek, Assessing changes to SR&ED and related policy instruments on Canada’s competitiveness for Foreign Direct Investment: November 22, 2013.

Note: Relative generosity is determined by dividing the after tax cost of performing $1.00 of R&D by 1 less the corporate tax rate.

Results are indexed to the relative generosity of Canada’s system of tax-based support for R&D. The higher the ratio the more competitive the tax system.

Canada has one of the best R&D tax treatments in the G7...

Canada currently offers one of the most favorable tax treatments for R&D among the G-7.

  • Canada provides a system of tax credits and accelerated tax deductions for a wide-variety of R&D expenditures.
  • Eligible costs include: salaries, overhead, capital equipment, and materials.

These tax-based treatments permit firms to significantly reduce R&D costs through direct investment or sub-contracting in Canada.

Figure 4-2

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R&D Investment in the Higher Education Sector, 2013

  • Canada: 0.65
  • Germany: 0.49
  • France: 0.46
  • Japan: 0.45
  • U.K.: 0.44
  • U.S. (2013): 0.39
  • Italy: 0.35

Source: OECD Main Science and Technology Indicators, 2015, Volume 2, February 2016.

…and a high level of R&D investment in higher education…

Canada is a world leader in post-secondary research, outpacing other G-7 countries on higher education investment.

Figure 4-3

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FDI-GDP Ratio 2009-2013

  • U.K.: 52.7
  • Canada: 35.0
  • U.S.: 25.9
  • G-7 Average: 25.8
  • France: 25.7
  • Germany: 21.0
  • Italy: 16.6
  • Japan: 3.7

Source: UNCTAD Stat Database, October 2015

in an Above Average Investment Environment

Canada is a leading G-7 nation in foreign direct investment performance when measured in terms of its GDP.

Figure 4-4

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Ease of Investor Protection* G-7 Ranking

  1. U.K.: 78.3
  2. Canada: 72.5
  3. France: 67.5
  4. Italy: 66.7
  5. U.S.: 65.8
  6. Japan: 62.5
  7. Germany: 59.2

* Standing based on three dimensions of investor protection: transparency of related party transactions, liability for self dealing, and shareholders’ ability to sue officers and directors for misconduct.

Source: Global Innovation Index 2015, Cornell University, INSEAD Business School, and World Intellectual Property Organization (WIPO)

with Solid Investor Protection

Canada ranks second in the G-7 and seventh in a 142-country study measuring the ease in investor protection.

Figure 4-5

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Canada’s Inward and Outward FDI Stock ($Billion)

Source: Statistics Canada, April 26, 2016

Canada’s Globalized Economy is Driven by a Dynamic Two-Way Investment Process…

Over the past decade, Canada has witnessed a substantial growth in both inward and outward FDI reflecting its strong connection to global supply chains.

Canada’s inward FDI stock reached C$768 billion in 2015, an almost 2-fold increase from C$398 billion in 2005.

As for Canada’s outbound FDI, the expansion of Canadian direct investment abroad (CDIA) has been equally spectacular, rising from C$452 billion in 2005 to C$1105 billion in 2015.

Figure 4-6

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Distribution of Canada’s FDI Stock by Major Regions, 2015 (%)
Major Regions2015
United States50.4
Asia and Oceania11.4
Latin America3.9

Share of Top 10 sources of FDI Stock in Canada, 2015, (%)

  • United States: 50.4
  • Netherlands: 11.6
  • Luxembourg: 7.9
  • United Kingdom: 4.5
  • Japan: 2.9
  • China: 2.7
  • Brazil: 2.6
  • Hong Kong 2.1
  • Germany: 1.8
  • Switzerland: 1.6
  • All others: 12.0

Source: Statistics Canada, April 26, 2016

…with the United States as Canada’s Largest Source of FDI

In 2015, the U.S. share of foreign direct investment (FDI) in Canada stood at 50.4%, demonstrating its confidence in Canada’s business climate.

Figure 4-7

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Share of Top 6 Industries in Canada’s FDI Stock, 2015, (%)

  • Manufacturing: 26.7
  • Mining and oil and gas: 20.6
  • Management of companies: 18.0
  • Finance and insurance: 12.8
  • Wholesale trade: 7.6
  • Retail trade: 5.1
  • All Others: 9.3

Source: Statistics Canada, April 26, 2016

* North American Industry Classification System (NAICS)

…and Overall FDI Geared Toward Industries with Strong Competitive Advantages

Almost 80% of foreign investment is in four main industries: manufacturing, mining and oil and gas extraction, management of companies and enterprises, and finance and insurance.

Figure 4-8

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Cumulative FDI Inflows Per Capita in the G-7, 2010-2014 $US

  • Canada: $6,632
  • U.K.: $4,441
  • U.S.: $2,872
  • Germany: $2,093
  • France: $1,822
  • Italy: $1,316
  • Japan: $25

Source: UNCTAD Stat Database, October 2015

Canada is Also a Leader in FDI Attraction

Since the financial crisis and ensuing global downturn, Canada has outperformed major global economies in attracting FDI: From 2010-2014, Canada was the largest recipient of per capita inflows among G-7 countries and the second largest in the G-20 following Australia.

Figure 4-9

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Economic and Institutional factors for attracting FDI: G-7 Ranking

  • Canada
  • U.K.
  • Japan
  • Germany
  • U.S.
  • France
  • Italy

*The 2015 index ranks 136 countries on 61 variables aggregated among four categories: Doing Business, Economic Fundamentals, Quality of Regulations, and the Rule of Law. Each of the 4 categories measures an economic or institutional factor affecting the attraction of foreign direct investment.

Source: Milken Institute, July 2015

…based on its Strong Economic and Institutional Environment for FDI

The Global Opportunity Index* ranks Canada’s economic and institutional factors for attracting foreign direct investment (FDI) as first in the G-7, first in the G-20 and sixth among all 136 countries surveyed.


Figure 5-1 

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Annual Transborder Crossings - 1983-1992
Total Number of Trucks and Canada-U.S. Air Passengers
(Two-way movements)
Annual Transborder Crossings - 1993-2002
Total Number of Trucks and Canada-U.S. Air Passengers
(Two-way movements)
Annual Transborder Crossings - 2003-2012
Total Number of Trucks and Canada-U.S. Air Passengers
(Two-way movements)
Annual Transborder Crossings - 2013
Total Number of Trucks and Canada-U.S. Air Passengers
(Two-way movements)

Source: Statistics Canada and Transport Canada, 2016 (* Preliminary data for 2015)

Canada has a Streamlined Trans-Border Transportation System…

The North American market is served by a well-integrated transportation system, which is among the world’s best.

  • Automated permit ports, transponder identification systems and joint processing centres are being tested and deployed for easy movement of goods.
  • Bottom line – the border system is one of the world’s most efficient.

Figure 5-2

Map of North and Central America

* Source: IMF Fiscal Monitor, April 2016

…with Direct Access to the NAFTA Market

Canadian-based businesses have access to one market of 484 million consumers with a combined GDP of nearly US$20 trillion.*

Many Canadian production hubs are actually closer to U.S. markets than American production sites — of Canada’s 20 largest cities, 16 are within an hour and a half drive of the U.S.

…and efficient transport linkages tying North America
to Asia and Europe.

A reliable and efficient transportation system is key to effective participation in global supply chains.

In October 2006, Canada has launched the Asia-Pacific Gateway and Corridor Initiative, an unprecedented alignment of public and private sector investments to strengthen Canada’s position as a fast, efficient and secure gateway between North America and Asia.

These investments have facilitated the flow of people, goods and services across Canadian rail, roads, bridges and through our ports and airports.

Sailing times from Canada’s Atlantic and Pacific deep-water ports are up to two days shorter than other North American ports.

6. An Excellent Place to Live

Figure 6-1

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Better Life Index* G-7 Ranking

  • Canada: 7.75
  • U.S.: 7.66
  • Germany: 7.35
  • U.K.: 7.10
  • France: 6.45
  • Japan: 6.03
  • Italy: 5.81

Source: OECD June 2016 * Index based on weighted average of 11 topics (housing, income, jobs, community, education, environment, civic engagement, health, life satisfaction, safety and work-life balance) identified as essential by the OECD in the areas of material living conditions and quality of life.

Canada’s overall quality of life is one of the world’s best.

Canada ranks first in the G7 and fourth among the 34 OECD countries in terms of overall living conditions and quality of life.

Figure 6-2

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Gross Domestic Product per Capita of G-7 Countries 2015 (US$ Market Exchange Rates)

  • U.S.: $55,805
  • U.K.: $43,771
  • Canada: $43,332
  • Germany: $40,997
  • France: $37,675
  • Japan: $32,486
  • Italy: $29,867

Source: IMF Fiscal Monitor, April 2016.

Canada has one of the highest standards of living among G7 countries...

Canada has one of the world’s highest standards of living, ranking 3rd in the G-7 and 4th in the G-20 as measured by the Gross Domestic Product (GDP) per Capita.

Figure 6-3

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Overall Quality of Life Ranking (Top 25 Cities)

  • 1st - Vienna
  • 2nd - Zurich
  • 3rd - Auckland
  • 4th - Munich
  • 5th - Vancouver
  • 6th - Dusseldorf
  • 7th - Frankfurt
  • 8th - Geneva
  • 9th - Copenhagen
  • 10th - Sydney
  • 11th - Amsterdam
  • 12th - Wellington
  • 13th - Berlin
  • 14th - Bern
  • 15th - Toronto
  • 15th - Melbourne
  • 17th - Ottawa
  • 18th - Hamburg
  • 19th - Luxembourg
  • 19th - Stockholm
  • 21th - Brussels
  • 21th - Perth
  • 23th - Montréal
  • 24th - Stuttgart
  • 24th - Nurnberg

Source: Mercer Human Resources Consulting: March 2016

…an exceptional quality of life in its cities…

In a recent annual ranking of the quality-of-life in 230 cities, four Canadian cities are among the top 25.

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Global Reputation* - Ranking of Top Ten Countries

  1. Canada
  2. Norway
  3. Sweden
  4. Switzerland
  5. Australia
  6. Finland
  7. New Zealand
  8. Denmark
  9. Netherlands
  10. Belgium

Ranking based on the Reputation Institute’s 2014 Country RepTrak(TM), an annual study measuring the public perceptions of 55 countries around the world. The study measures the overall Trust, Esteem, Admiration and Good Feelings the public holds towards these countries, as well as their perceptions across 16 different attributes, including a good quality of life, a safe place to live and a strong attention to their environment.

Source: Reputation Institute, New York, July 2015

…and the Best Overall Reputation on the Global Stage

The Reputation Institute ranks Canada as having the highest reputation ranking among 55 countries based on several indicators, including a good quality of life, a safe place to live, an advanced economy, an effective government and an appealing environment.

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Global Peace Index* G-7 Ranking

  1. Canada
  2. Japan
  3. Germany
  4. Italy
  5. France
  6. U.K.
  7. U.S.

*Standing among 163 countries. Index ranking countries based on peacefulness, both domestically and abroad using 22 indicators, including the number of soldiers killed overseas, the level of violent domestic crimes and relations with neighbouring countries.

Source: Economist Intelligence Unit, June 2016

Canada ranks high among model nations of peace…

According to the Global Peace Index, a recently released measure by the Economist Intelligence Unit, Canada stands first in both the G7 and the G20 and eighth among 163 countries surveyed.

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Democracy Index* G-7 Ranking

  1. Canada
  2. Germany
  3. U.K.
  4. U.S.
  5. Japan
  6. France
  7. Italy

*Standing among 167 countries. Index ranking countries based 60 indicators grouped in five different categories: electoral process and pluralism, civil liberties, functioning of government, political participation and political culture.

Source: Economist Intelligence Unit, April 2015

…and Vibrant Democracies

According to the Economist Intelligence Unit’s Democracy Index, Canada stood first in the G-7, first in the G-20 and seventh among 167 countries surveyed.

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Security* – World Rank

  • Canada: 9.0
  • U.K.: 8.5
  • U.S.: 8.43
  • Germany: 8.25
  • Japan: 8.04
  • France: 7.48
  • Italy: 5.85

*Confidence that person and property is protected. Rank among 61 economies considered in the 2016 World Competitiveness Yearbook.

Justice** – World Rank

  • U.K.: 8.31
  • Canada: 8.26
  • Germany: 8.07
  • Japan: 7.83
  • U.S.: 7.33
  • France: 6.76
  • Italy: 3.77

**Degree of fairness of the judicial system in Society. Rank among 61 economies considered in the 2016 World Competitiveness Yearbook.

Source: IMD

Canada is also a safe and just society…

Canada is a G7 leader in terms of safe places to live and to conduct business under a fairly administered
judicial system.

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Equal Opportunity* — World Rank

  • Canada: 8.05
  • U.K.: 7.08
  • U.S.: 6.86
  • Japan: 6.41
  • Germany: 6.34
  • France: 6.18
  • Italy: 5.24

Source: IMD *Race, gender, family background does not pose a handicap for competitiveness.
Rank among 61 economies considered in the 2016 World Competitiveness Yearbook

…a land of equal opportunity…

Canada ranks first among the G7 in providing equal opportunities for individuals.

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Language Distribution in Canada* (% of Population)

Source: Statistics Canada, 2001 and 2011 Census

* Based on mother tongue

…and a society rich in multiculturalism.

Canada has one of the world’s most multilingual societies with over 200 languages identified as the mother tongue.

There has been an overall increase in the proportion of the population whose mother tongue is neither English or French from 18.0% in 2001 to 20.6% in 2011.

Canada — Solid Reasons to Invest

Canada’s economic fundamentals and relative cost advantages provide a first-rate business environment. Canada offers:

Excellent Economic Fundamentals

  • Low inflation and low interest rates
  • One of the strongest economies in the G-7

A Highly Competitive Business Environment

  • Ease in establishing and conducting a new business
  • Competitive business costs
  • Competitive tax system
  • Strong financial and technological environment

A Dynamic Workforce

  • One of the world’s best-educated internationally-oriented workforces
  • Quality management training
  • Technology savvy workers

A Solid Venue for Innovation and Investment

  • Quality R&D Tax Treatments
  • World leader in post-secondary research

Easy Access to Markets

  • Geography and NAFTA provide easy access to the world’s most prosperous market
  • Highly efficient transportation linkages with Asia and Europe

An Excellent Place to Live

  • Superb overall quality of life
  • A society rich in multiculturalism

Invest in Canada

Through Canadian diplomatic missions around the world, and with direct access to investment contacts at national, provincial and municipal levels within Canada, the Invest in Canada Bureau of the Department of Foreign Affairs, Trade and Development is well positioned to assist you with your investment in Canada. We invite you to start exploring all that Canada has to offer at:

For further information, please contact our investment specialists at your local Canadian Embassy, High Commission or Consulate:

or write to us at:

Think Canada! is prepared by Arif Mahmud,
Investment Strategy and Analysis Division,
Office of the Chief Economist