The Economy of Canada
Canada’s economy is highly dependent on international trade with exports and imports of goods and services each comprising about one-third of GDP. The country’s three largest trading partners are the U.S., China, and the U.K. Its three largest industries, measured by their contributions to GDP, are real estate, rental, and leasing; manufacturing; and mining, quarrying, and oil and gas extraction.
The COVID-19 pandemic caused Canada’s economy to pull back sharply in the first half of 2020 before rebounding in the latter half of the year. In the second quarter of 2020, real GDP fell 11.3% quarter-over-quarter (Q/Q), but rose 9.1% Q/Q in the third quarter and then 2.2% Q/Q in the fourth quarter of 2020, offsetting the steep decline earlier in the year.
Economic activity in Canada tends to be concentrated in cities. About half of Canada’s GDP is produced in the six CMA s with a population of 1 million or more—Toronto, Montréal, Vancouver, Calgary, Edmonton, and Ottawa–Gatineau.
There are major economic differences among Canada’s four main geographic regions — Ontario, Quebec, the West and Atlantic Canada — each affected by its own history of economic development, industrial location, urbanization, land use and migration.
Real estate, manufacturing, and mining are key drivers of Canada's economy
Canada has the ninth-largest economy in the world as of 2020, with a GDP of $1.64 trillion in USD.
International trade, including both exports and imports, is a large component of Canada’s economy, each making up about one-third of GDP.
Canada’s largest trading partners are the U.S., China, and the U.K.
The three largest industries in Canada are real estate, mining, and manufacturing.
Canada’s Top Industries:
Real Estate, Rental, and Leasing
Canada’s real estate, rental, and leasing industry is comprised of establishments engaged in the following types of activities:
real estate management; selling, renting, or buying real estate for others; appraising real estate; rental and leasing of tangible assets such as automotive equipment; and leasing of nonfinancial intangible assets such as copyrighted works.
Canada’s manufacturing industry is engaged in the physical or chemical transformation of materials or substances into new products. These products may either be finished goods for consumption or semi-finished goods to be used in manufacturing processes.
Canada’s industries manufacture food, chemicals, petroleum, fabricated metal products, machinery, transportation equipment, and other products.
Mining, Quarrying, and Oil and Gas Extraction
Canada’s mining, quarrying, and oil and gas extraction industry is primarily engaged in the extraction of naturally occurring minerals.
The industry is dominated by oil and gas extraction, but other types of mining activity include mining coal and a range of metals, including gold, silver, copper, nickel, and more. Stone, sand, gravel, clay, and ceramic mining and quarrying are also part of the industry, as well as mining for potash.
Healthcare and Social Assistance
Finance and Insurance
Canada’s Top Trading Partners
#1 Trading Partner: The U.S.
# 2 Trading Partner: China
#3 Trading Partner: The U.K.
What are the major cities in Canada?
Canada is the second largest among all countries in the world. Immigrants from all parts of the world come to Canada. They settle mainly in the top cities of the country. These are:
- Toronto: The city having the highest population in Canada is the capital of the province of Ontario. Toronto ranks amongst the top financial centers in the world. Some of the major tourist attractions of Toronto include the Casa Loma, the Royal Ontario Museum, and the Art Gallery of Ontario, and CN Tower.
- Montreal: It is the second amongst the top cities of Canada. It is situated in the province of Quebec. For many years Montreal had been the financial and industrial hub of Canada. It also blends a hint of European sophistication in itself making it one of the most popular cities in Canada. Some of the city’s attractions include Montreal Botanical Garden, Mount Royal, Point-a-Calliere Museum, and Montreal Biodome.
- Vancouver: This city is a primary seaport situated in British Columbia. Vancouver is ranked in the category of the most habitable cities in the world. It has been the venue for numerous international events and conferences like 1986 World Exposition on Transportation and Communication, and the United Nations Conference on Human Settlements in 1976. Vancouver is one of the top industrial centers in Canada.
- Ottawa: The capital of Canada, Ottawa is located in Ontario. This city has world class academic scopes, and is a technological and financial hub. Ottawa also boasts of an entertainment and cultural side. It has the highest population in Canada of educated work force.
- Calgary: This city is supposed to be the largest in the province of Alberta. It is widely known for ecotourism and winter sports. Calgary’s economic growth is dependent primarily on the petroleum industry.
Why Is Canada Wealthy?
Canada is a wealthy nation because it has a strong and diversified economy. A large part of its economy depends on the mining of natural resources, such as gold, zinc, copper, and nickel, which are used extensively around the world. Canada is also a large player in the oil business with many large oil companies. The country also has a large financial sector with many banks and other financial institutions, as well as a large real estate industry.