We’ve officially entered into a new decade. But there’s no sense in looking too far ahead at what the future holds for the Canadian economy. 2020 will have enough developments and intrigue of its own. In particular, early indicators suggest global protectionist policies from major countries like the United States, China, and the United Kingdom could have a significant impact on the direction that Canada’s economy takes.
Takeaways From Peter Hall’s 2019 Innovators Exchange Address
Peter Hall, Vice President and Chief Economist with Export Development Canada, recently spoke at the 2019 Innovators Exchange event. As always, his voice is one of the most highly respected when it comes to matters of foreign and economic policy. Here are some of the factors he believes will greatly test Canada’s economic resilience in 2020 and beyond:
US-China Deal: This has been one of the more intriguing trade disputes in recent memory. The ramifications of which extend far beyond the two nations directly involved. If nothing else, it’s shaking global confidence and stability. Many Asian countries that manufacture machinery and components used to make U.S. goods have seen their exports decrease over the last 12 months. This has put a curb on growth and likely will for the foreseeable future.
The U.S. is also involved in trade disputes with other major economies, including the European Union. There’s always the potential that this could spark mutual tariff increases and/or chill business investments for months at a time. In turn, Canadian goods and services could experience lower global demand – thereby reducing revenue from exports.
Brexit: It’s been a long, drawn-out process for Brexit. But with the recent vote confirming Brexit, the path has been paved for the U.K. to leave the EU by the end of this month. And as much change as this will create, collective uncertainty among global powers has actually been reduced. For the first time in many years, the U.K. appears to have the stable leadership needed to nudge the economy forward. This could give key trading partners, including both the US. and Canada, confidence to move forward with new trade agreements in the region.
Recession: We’re in the midst of an unprecedented stretch of growth, but many expert analysts and advisors believe the economic cycle has peaked. This would normally mean a global slowdown and worldwide recession would be in store – impacting Canada. Interestingly enough, many actually concede that this recession would be the result of policy missteps and not necessarily economic fundamentals.
Artificial Intelligence: Canadian exporters are sitting on data goldmines, yet have failed to recognize and/or utilize the abundance of riches they have in store. If these exporters wake up and realize just how much power their data could give them, there’s potential for significant growth. Hall is pleading with these organizations to pick up their proverbial shovels and start digging.
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