In 2018, Canada will assume the presidency of the G-7. This is a prestigious honor which is bestowed upon countries that are economic and political beacons of hope for the world. The Canadian economy is rapidly emerging from a 90s death spiral that saw sharp contractions taking place. Now, Canada is a symbol of prosperity, hope and economic opportunity for the world at large. The current growth rate in Canada is on par for the fastest GDP growth rate in 6 years.
Heading into 2017, Canada surpassed 0.6% growth in January, according to Statistics Canada. Economists were anticipating a growth rate of 0.3%. The global financial crisis had a detrimental impact on the Canadian economy, largely due to the heavy reliance of the economy on commodities like crude oil. At the start of 2017, leading economists were anticipating an economic growth rate in the region of 3.5% – 4% – an unprecedented increase for this North American powerhouse. The Canadian economy has been a robust performer in terms of jobs creation and economic opportunities.
The dramatic oil price collapse of recent years was devastating for the Canadian economy, notably the loonie which found little comfort in international currency markets. According to StatsCan strong growth has been reported in the natural gas and oil sectors, and this is increasing month on month.
The Bank of Canada has taken all of this in its stride; talk of an interest rate hike remains on the back burner while the economy is gathering momentum. Currently, the interest rate in Canada is 0.5%, among the lowest of the developed economies, and on par with that of the United Kingdom. This is good news for investors and consumers who can take full advantage of low interest rates with financing, business loans and personal credit facilities.
The current inflation rate in Canada is 1.6%, and the unemployment rate is marginally higher than the US rate at 6.5%, but declining. This paints a picture of an economy on the mend. Added to that are important business metrics. The Canadian business confidence level is currently 53.8 (any figure above 50 is expansionary and bullish), and Manufacturing PMI is 55.1.
The current consumer confidence level is also positive at 52.32, and growing. Canadian GDP was measured at $1.55280 trillion in 2015, this is substantially more than the GDP of countries like Mexico and Australia. In terms of GDP per capita, Canada ranks highly at $43,248.53 (2015 figures). As such, Canada remains one of the most lucrative countries for global investors.
Capital flows have been pouring into Canada at a rate of knots. Various reputable money transfer services have reported a sharp uptick in international investment in Canada, thanks largely to the myriad of opportunities now available in the economy. Foremost among them are widespread changes in automation. This disruptive technology is set to revolutionize the Canadian manufacturing industry, and global investors are cashing in in the nascent stages.
A paradigm shift in employment is taking shape in Maple country, and a massive transfer of money to Canada from abroad is now evident. The growth of money transfer industries has been unprecedented in recent years, and all of these companies are targeting Canada and its vast investment potential. Investors are getting significantly more bang for their buck by using non-bank services for their money transfers.
Favorable Exchange Rates
In 2016, it is estimated that some C$30 billion was transferred out of Canada, with C$1 billion going largely to banks in fees and commissions. These extortionary profits have precipitated the rapid rise of non-bank money transfer services in Canada. The traditional bricks and mortar banks and financial institutions were put on notice with the advent of these money transfer services, and now fees are coming down across the board. The inefficiencies that currently exist in the regulated banking environment have acted as a disincentive to investment and money transfer to and from Canada.
Nonetheless, Canadians have embraced the many options available to them for global investments, and foreigners are taking advantage to purchase real estate, established businesses and cash in on Canada’s vast natural resource wealth. Transferwise’s exchange rate estimator makes it easy for Canadians and foreigners to estimate precisely how much they can expect from their money transfers.
Since there are no fees on the actual transfer, these bank-beating rates are among the lowest in the world. This means that more personal or business funds are available for investment purposes, or personal money transfers. This creates an equitable platform for everyone operating within the financial system.