OTTAWA, March 14, 2013 /CNW/ - Canada's economy moved up to a ranking of
sixth among the 16 countries assessed in The Conference Board of
Canada's 2012 How Canada Performs: Economy report card.
While Canada retains a "B" grade and improved its ranking from 11th in the last pre-recession report card for 2008, it is more a reflection
of weakness among its peers than of a stellar Canadian economy.
"This "B" grade should be viewed as relative because Canada fares poorly
when compared with the top-performing economies. With the exception of
inflation and employment growth, Canada ranks far below the best
countries on all other economy indicators," said Glen Hodgson, Senior Vice-President and Chief Economist.
"Canada has been a chronic laggard on several important economic
indicators - notably, labour productivity growth and competition for
global investment. And even in areas where Canada has improved, other
countries are still doing better."
Canada's improved ranking in 2012 is less about its performance and more
a result of fiscal and financial uncertainty in much of the European
Norway and Australia are the top performers, achieving "A" grades.
Despite its uneven economic recovery and unsettled public finances, the
United States also gets a "B" grade and ranks fourth, two places ahead
Canada's overall economic performance has deteriorated relative to its
peers since the 1970s.
For each indicator, the Conference Board ranks the performance of all
country from top to bottom, and divides this range into four equal
segments from "A" to "D".
Along with most of its peers, Canada gets an "A" grade on inflation. Canada gets "B" grades for gross domestic product (GDP) growth, labour
productivity growth, employment growth, and the unemployment rate. But
Canada's overall ranking is pulled down by "C" grades on income per
capita and outward foreign direct investment (FDI), and a "D" on inward
Canada's ranking on income per capita dropped from sixth position among
comparator countries in 2000 to eighth in 2008, and remained there
through 2012. Canada's income per capita was US$36,138 in 2012— nearly
$12,000 below Norway, the top performer.
Furthermore, income per capita in Canada is 84 per cent of income per
capita in the United States. The income gap tripled between 1980 and
2012. The importance of productivity shows up in this measure - lower
labour productivity in Canada accounts for the largest component of the
Canada attracted 2.7 per cent of the world's foreign direct investment
in 2011 and accounted for 2.5 per cent of world GDP. This performance
placed Canada sixth out of 16 countries on inward FDI in 2011, which suggests, at first glance, that Canada is a relatively
attractive market for investors.
Nevertheless, Canada is one of 13 countries to earn "D" grades on inward
FDI. Belgium is the runaway leader on this indicator, with eight times
more inward FDI than its share of the global economy. Belgium's
performance effectively lowers the grades of the other 15 countries.
Canada gets a "C" grade on the Outward FDI Performance Index for 2011 and ranks 10th. Since the late 1990s, the stock of Canadian direct investment abroad
has been greater than the stock of FDI in Canada. This shift indicates
that Canadian firms are using foreign direct investment to build global
value chains and serve customers in other countries. That said, Canada
still ranks far behind the top performers, particularly the two
countries that earn "A" grades - Belgium and Switzerland.
How Canada Performs is a multi-year research program at The Conference Board of Canada to
help leaders identify relative strengths and weaknesses in Canada's
socio-economic performance. The How Canada Performs website presents data and analysis on Canada's performance compared to
15 peer countries in six performance categories: Economy, Innovation, Environment, Education and Skills, Health, and
SOURCE: Conference Board of Canada
For further information:
Brent Dowdall, Media Relations, Tel.: 613- 526-3090 ext. 448