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Canada Economic Snapshot

Going for Growth 2021 - Canada

Building a more resilient and inclusive economy requires strengthening welfare policy. The pandemic highlighted a general problem of weak backing for those unemployed or experiencing poverty, the gender-wage gap remains large and Indigenous peoples remain under-privileged in most socio-economic dimensions.

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2021 Structural Reform Priorities

  • Social protection: Strengthen support for vulnerable households
  • Labour market: Increase the labour-market inclusion of women
  • Competition and regulation: Reduce barriers to internal trade
  • Competition and regulation: Reduce barriers to entry for both domestic and foreign suppliers and enhance competition in network and service sectors
  • Tax system: Eliminate inefficient tax expenditures and increasing carbon prices

 

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Economic Survey of Canada - 11 March 2021

Executive Summary

Presentation

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Economic Forecast Summary (December 2020)

Recovery from an output decline of 5.4% in 2020 will be muted by drag from regional restrictions to combat COVID-19 outbreaks and continued disruption to travel, hospitality and related sectors, leading to output growth of 3.5% in 2021. These developments will be echoed by a slow labour market recovery and low consumer price inflation. With vaccination against the virus set to become general in the latter half of 2021, diminished restrictions and a recovery in hard-hit sectors will support growth in 2022. Growth of the public debt burden will slow.

Federal, provincial and territorial governments, along with the central bank, have been appropriately reactive to the evolving economic conditions. Going forward, governments need greater emphasis on encouraging employment and business recovery, including through green investment and through tackling long-standing structural issues that impede Canada’s business sector. Ensuring that the enhancement of employment insurance is adequate following the termination of the Canada Emergency Response Benefit (CERB) also needs to be a priority. The Bank of Canada should stand ready to provide further liquidity support if required.