Canada

High interest rates to weigh on the economy in 2024

AA1

LOW RISK for entreprise

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

Updated in January 2024.

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GDP USD 2139.8bn (World ranking 9, World Bank 2022)
Population 38.9mn (World ranking 37, World Bank 2022)
Form of state Constitutional parliamentary monarchy
Head of government Justin Trudeau (PM)
Next elections 2025, legislative
  • Canada has experienced robust job creation, with an average of 40k new jobs per month, signaling strength in the labor market
  • The country boasts a stable business and political landscape with well-managed fiscal and monetary policies
  • Despite facing economic challenges, Canada has historically showed resilience, with a well-managed economy and a history of maintaining a balanced fiscal and monetary approach
  • Aggressive interest rate hikes by the Bank of Canada have successfully curbed inflation but have simultaneously slowed economic growth, projecting a weak GDP growth for 2024
  • Soaring housing prices, coupled with high mortgage rates and decreased activity, present challenges in the housing market, potentially impacting economic growth
  • Inflation’s cumulative effects have outpaced wage growth, impacting consumers’ purchasing power. The dwindling personal savings and reluctance to take on more debt pose challenges for sustaining consumer spending, a significant driver of economic activity

Trade structure by destination/origin

(% of total, 2021)

Exports Rank Imports
United States 77%
1
49.1% United States
China 3.7%
2
13.5% China
United Kingdom 2.3%
3
5.5% Mexico
Japan 2.3%
4
3.0% Germany
Mexico 1.2%
5
2.3% Japan

Trade structure by product

(% of total, annual 2021)

Exports Rank Imports
Petroleum, petroleum products and related materials 23.7%
1
13.5% Road vehicles
Road vehicles 8.2%
2
6.7% Petroleum, petroleum products and related materials
Gas, natural and manufactured 3.9%
3
5.5% Other industrial machinery and parts
Non-ferrous metals 3.7%
4
5.0% Electrical machinery, apparatus and appliances, n.e.s.
Metalliferous ores and metal scrap 3.3%
5
3.9% Telecommunication and sound recording apparatus
The Allianz Trade Collection Complexity Score provides a simple assessment of how easy it is to collect debt around the world. The 2022 edition covers 49 countries that represent nearly 90% of global GDP and 85% of global trade.
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