Canada has experienced sluggish economic growth in 2023, owing to rising prices and higher credit costs, which had a direct impact on the investment and consumption channels, despite the benefits of the country’s growing population. Furthermore, one cannot expect a significant improvement over the short run. Canadian households are amongst the most indebted in the world. Admittedly, their level of net wealth contributes to offset this fact, but it still implies an increased vulnerability against the backdrop of monetary tightening and a deteriorating labour market
In May 2017, Donald Trump triggered a renegotiation of the North American Free Trade Agreement (NAFTA). Some proposals, 23 years after NAFTA came into force, aiming to introduce a chapter on the digital economy and strengthen the agreement’s current arrangements, have been generally welcomed. Others, such as a tightening of rules of origin and changes to trade remedies, have prompted concern.
Canada is considered as one of the most stable and resilient economy. Nevertheless, it was not spared by the COVID-19 outbreak. GDP fell by 5.3% in 2020, not only because of lockdowns that depressed activity in services, but also as consequence of the fall in oil prices (Canada ranks fifth worldwide among oil exporter countries). The shock was short-lived, and Canada was among the first to benefit from the recovery in world trade and commodity markets.
