Canada on track to lead G7 economies this decade: CIBC

By STEFANIA MORETTI, QMI Agency

This may be Canada’s decade, according to a new report by CIBC that predicts the country is likely to lead growth in the G7 for the next 10 years if it plays its cards right.

Relatively lower government and corporate debt, immigration and trade balances mean it’s Canada’s “time to shine,” according to a report released Friday by CIBC World Markets.

Mounting debt troubles in Europe and geopolitical tensions in Asia have grabbed headlines in recent weeks.

It’s not that Canada will benefit from others’ malaise, Avery Shenfeld, CIBC's chief economist, told QMI Agency. A weakening in any part of the world is still bad for every other country in terms of exports.

“It’s more that when we look at who’s going to do better over the medium term, we have some advantages in terms of not having as many problems as they do.”

Problems in Europe have overshadowed Canadian fundamentals and even dampened expectations for growth.

But Canada's rich resources, resilient financial system and favourable demographics relative to other G7 nations make it an economic contender looking out over the next five to 10 years, Shenfeld said.

Another notable positive is in Canada's healthier state of public- and corporate-sector balance sheets.

But these factors aren’t “ironclad,” Shenfeld warned. They only mean Canada is better positioned than its debt-laden counterparts. “It’s not smooth sailing from here.”

Controlling ballooning debt and tightening fiscal policy appear to be the keys to success, Shenfeld said.

Canada’s central bank will be among the first to hike its interest rates this summer, so growth may not be something to boast about in 2011. But that will change, Shenfeld said.

“It’s as we look further on that we will have fewer years of cuts, that Canada may, in fact, shine through,” he said.

Finance Minister Jim Flaherty has put into motion a plan to rein in spending with the hope of all but reducing Canada’s budget deficit from $53.8 billion in 2010 to less than $2 billion by 2015.

Canada’s parliamentary budget officer has said the effort isn’t enough, and that five years down the line, federal balance sheets are projected to show a structural deficit of $12.3 billion.

Still, Canada’s current federal deficit of 3% of GDP (5% including provinces) pales in comparison to the U.S.'s and U.K.'s double-digit deficit-to-GDP rations, Shenfeld said.

Canada’s population and productivity demographics are also in better shape than more mature economies thanks to strong immigration and renewed business investment.

Resource-hungry emerging markets will also ensure strong demand for energy and metal products, which traditionally account for about a third of Canada's domestic income growth, the report said.

Canada will have more seniors than kids in the next decade: StatsCan

Canada’s population is expected to increase by as much as 14 million by 2036, according to Statistics Canada’s newest report on population growth.

The agency projects that between 2009 to 2036, Canada’s population could grow from its current 33.7 million to between 40.1 million and 47.7 million.

According to the report, immigration levels represent the greatest share of the projected population increase, with Canada receiving as many as 333,600 immigrants a year by 2036, compared with 252,500 in 2010.

But high immigration levels won’t put a dent in Canada’s rapidly aging population– seniors could account for nearly a quarter of Canada’s entire population by 2036, nearly double the 13.9% they accounted for in 2009.

Seniors are expected to surpass the number of children aged 14 or under for the first time ever between 2015 and 2021.

StatsCan’s provincial and territorial breakdowns have Ontario and B.C. leading the pack in population growth, with rates higher than the national average. Newfoundland and Labrador was the sole province projected to have a population decrease.

Ontario’s population is expected to increase from nearly 13.1 million in 2009 to between 16.1 million and 19.4 million in 2036; Quebec’s population would increase from 7.8 million in 2009 to between 8.6 million and 10 million in 2036. In the west, British Columbia’s population would increase from nearly 4.5 million in 2009 to between 5.8 million and 7.1 million in 2036.

Below, a complete breakdown of StatsCan’s projected population growth by province.

• Alberta’s population would increase from 3.7 million in 2009 to between 4.6 million to 5.4 million in 2036.
• Manitoba’s population would increase from 1.2 million in 2009 to between 1.4 million to 1.7 million in 2036.
• Saskatchewan’s population would increase from 1 million in 2009 to between 1.1 million to nearly 1.3 million 2036.
• Nova Scotia’s population would increase from 938,000 in 2009 to between 987,000 and 1.1 million in 2036.
• New Brunswick’s population would increase from 750,000 in 2009 to between 772,000 and 874,000 in 2036.
• Newfoundland and Labrador’s population could decrease from nearly 509,000 in 2009 to 483,000 in 2036. But medium to high growth projections could result in an increase of anywhere from 514,000 to 545,000 in 2036.
• Prince Edward Island’s population would increase from 141,000 in 2009 to between 161,000 and 188,000 in 2036.
• The population of the Northwest Territories would increase from 43,000 in 2009 to between
49,000 and 57,000 in 2036.
• Yukon’s population would increase from nearly 34,000 in 2009 to between 36,000 and 42,000 in 2036.
• Nunavut’s population would increase from 32,000 in 2009 to between 36,000 and 44,000 in 2036.

Read more: http://news.nationalpost.com/2010/05/26/canadas-population-could-exceed-40-million-by-2036-statscan/#ixzz0pBYcSKNq