Economy of Canada

Date: 2015-10-07; view: 498.

Canada is a unique country. Its economy has features of advanced capitalist states and also of the dependent countries.
In the 20th century Canada became an industrial country with highly developed intensive agriculture. Before that Canada had been mostly an agricultural country. But since the WWII more people have worked in manufacturing than in agriculture.
But agriculture (farming) is still important. Canada exports many agricultural products, which account for mush of the country's export.
Agricultural sector produces:
- cereals (primarily wheat and barley)
- dairy products
- fruit
- wool
- fur
Arable land is only 5% of the total area, but farming is highly developed and intensive.
The most important agricultural regions are:
- the prairies, which represent 80% of Canada's farmland
- the Great Lakes and St. Lawrence fertile lowlands in Ontario and Quebec.
It is the major corn producing area of Canada and a horticultural region.
Canada's economy has always been based on abundant natural resources, which include:
- fish
- timber and wood products
- minerals
- hydroelectricity
One of the most important industries is the manufacture of wood pulp and paper.
Minerals that are found in Canada include:
- zinc
- copper
- gold
- lead
- molybdenum
- potash
- silver
- coal
- natural gas and oil
Canada has rich fishing grounds.
Manufacturing has long been a weak component of Canada's economy. And now it employs just 14% of the country's workers. The most important manufactured product is motor vehicles. Recently new high technology (hi tech) industries have developed, including information technology and aeronautics.
Canada's leading industries include:
- automobile manufacturing
- pulp and paper
- iron and steelwork
- machinery and equipment manufacturing
- mining
- extraction of fossil fuels
- forestry
- agriculture
As an advanced capitalist state Canada has an enormous service sector, including the civil service. Services account for some 75% of the country's economy.

Problems
1) Dependency on foreign capital
In the 20th century Canada became independent of the UK only to find herself more dependent on the US than the it has been on Britain. Canada was the scene of rivalry between US and the British capital. In the rivalry US monopolies were more successful. As a result foreign monopolies control.
- 75% of Canada's main extractive industries
- 50 % of it's manufacturing industries
As a trading country Canada is strongly influenced by the USA, the country's major traiding partner.
Canada exports primary materials:
- metals
- fish
- wheat
- coal
- lumber
- furs
- oil
- natural gas
and imports manufactures.
Most of the companies belong to the US capital; they are "daughter" companies of the big concerns. The US export to Canada vast quantities of:
- capital
- the money and the machinery for mining, pulp and paper industries.
Relatively little of this investment goes into the Maritime Provinces and eastern Quebec, a chronically poor region.
Canada has begun to veer away from Washington policies. The tendency started in the 1960's when Canada celebrated its centennial (1967).
Besides, Anti-Americanism was stimulated by such developments in the US like: racial conflicts, political association of John Kennedy and the Vietnam War. These were the events of the 1960's (the decade) in the US. A wave of anti-Americanism swept through Canada's intellectual circles.
In 1974 Parliament passed a law requiring that foreign investments be screened by the cabinet before being permitted.
American investors retaliated by cutting back or completing shutting down Canadian branch plants and business.
In 1988 the USA and Canada signed an agreement of lifting within 10 years of all barriers in their trade. This makes Canada even more dependent on its southern neighbor.
2). The large national debt and the massive annual federal deficit.
3). High unemployment rates. Currently unemployment is around 10% with regional variations
The inflation rate is about 2,5%
4) Canada has an immense "underground economy", which includes not only criminal activities but also different way and means of legitimate business they resort to in order to avoid paying.
Living standard. Social programs.
Canada ranks (claims) 6th place in the world in living standard (behind only: 1) the US, 2) Switzerland, 3) Luxembourg, 4) Germany, 5) Japan)
The living standard is high largely owing to extensive social programs of which Canadians are justifiably proud.
Social security network (system) includes:
- an old age pension
- a family allowance
- unemployment insurance
- welfare for the needy
- free Medicare system
Basic health care with the exception of dental services is free. Prescription drugs are in most cases free of charge for people over 65 social and recipients.