Photo by Amir Jina
Mark Carney, governor of the Bank of Canada, delivered a speech about Canada’s future economic development at the Canadian Club of Ottawa on Monday, and his message is more than clear: we need to diversify from our traditional economic partner countries before it is too late.
Getting over the hurdle
According to Carney, it is high time for Canadian foreign investors to realize the potential of emerging economies such as China, Brazil, and India. The centre of gravity of the global economy has been moving towards emerging economies for a long time, but the economic recession has sped up the process considerably. While, in 2000, these countries contributed to the overall world growth by one third, now they are responsible for almost all global gains.
While emerging economies enjoy their developing success, our old business partners like the United States and Europe seem to be in constant trouble. The aftermath of the crisis has not gone as smoothly as expected, and both the US and EU countries experience difficulties in handling debts, unemployment, and inflation. Moreover, another trading partner, Japan, faces enormous problems after its earthquake and tsunami and does not seem to be able to focus on economic competition right now.
The Canadian economy faces a challenge: either it will use up the time left to focus on exploiting the emerging markets or it will stay passive and wait for the slow decline of advanced countries’ wealth. Right now, we are not harnessing the potential of the new markets to the fullest — especially when it comes to the massive increase in demand in Asia. This must be rectified as soon as possible.
