Author(s):
Shawn Denstedt, KC, Stephen Poloz, Brad Wall
Feb 9, 2022
As Canada and the rest of the world gradually emerge from the pandemic, policymakers and businesses alike can take several lessons from the last two years of economic volatility and unpredictability. Osler’s Shawn Denstedt, QC, Vice Chair of Western Canada, hosted a discussion with Special Advisors Stephen Poloz and Brad Wall on how Canada can harness its natural advantages to contribute to economic recovery at home and abroad, including strengthening ties between Western Canada’s agriculture and energy industries and countries in South East Asia, the effects of geopolitical developments on trade agreements and investment opportunities, and what we can expect to see in the years to come.
While industries like travel were hit especially hard by the pandemic, the economy as a whole — and the people who make it go — proved far more resilient than might have been anticipated. Swift action via fiscal policy was one major factor behind that resiliency. Changes in interest rates normally take months to see their effects, but here, special programs sprung up within weeks to pause mortgages and supplement paychecks. Though countries around the world fell into the pandemic largely at the same time, their recovery has so far been more staggered. As a result, businesses should probably expect sporadic disruptions into the future. Those who manage that uncertainty best moving forward will likely encounter new opportunities and success.
Canada boasts several natural advantages that it can harness to help with economic renewal. While the road to net-zero carbon emissions by 2050 is still uncertain, Canada will continue to be an important energy exporter as demand grows worldwide. It also has the land, potash and scope to expand its agricultural industry as climate change and growing populations put pressure on growing regions globally. Recent agreements like the Comprehensive Economic and Trade Agreement with the European Union and ongoing free trade negotiations with South East Asian countries will provide significant investment and business opportunities for assets like lumber, grains, fertilizer and other economic building blocks. Further, a strong, internationally attractive higher-education system leading to solid jobs will help to bolster immigration targets.
Focusing on Canada’s fundamental strengths should serve the country well in the coming years, even in the face of slowing growth, the potential for more volatility and the need to diversify and decarbonize. With nations in need of fuel, food and fertilizer, sustainable development of those resources will both contribute to the clean energy transition and aid in global recovery. Governments can reduce uncertainty for businesses by developing stronger, concrete relationships with international partners as geopolitical events threaten progress and investing in the infrastructure needed for growth.
Listen to the full conversation.