How Canada is falling behind the USA
The economies of Canada and America are joined at the hip. Some $2bn of trade and 400,000 people cross their 9,000km of shared border every day. Canadians on the west coast do more day trips to nearby Seattle than to distant Toronto. No wonder the two economies have largely moved in lockstep in recent decades: between 2009 and 2019 America’s GDP grew by 27%; Canada’s expanded by 25%.
Yet since the pandemic North America’s two richest countries have diverged. By the end of 2024 America’s economy is expected to be 11% bigger than five years before; Canada’s will have grown by just 6%. The difference is starker once population growth is accounted for. The IMF forecasts that Canada’s national income per head, equivalent to around 80% of America’s in the decade before the pandemic, will be just 70% of its neighbour’s in 2025, the lowest for decades. Were Canada’s ten provinces and three territories an American state, they would have gone from being slightly richer than Montana, America’s ninth-poorest state, to being a bit worse off than Alabama, the fourth-poorest.
Source: The Economist