THINK CANADA MAY 2018

PREPARED BY Investment Strategy and Analysis Division, Office of the Chief Economist

Global Affairs Canada

investincanada.com

investiraucanada.com

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2

Table of Contents

I Excellent Economic Fundamentals 3

II A Highly Competitive Business Environment 13

III A Dynamic Workforce 23

IV A Promising Venue for Innovation & Investment 30

V Easy Access to Markets 38

VI An Excellent Place to Live 43

EXCELLENT ECONOMIC FUNDAMENTALS

I

Source: Consensus Forecasts, April 2018, Consensus Economics Inc. 4

Despite the global slowdown, Canada’s economic prospects are strong, based on a consensus of forecasts.

2.2 2.2 2.2

1.1

0.4

1.6

1.3

2.3

2.6

1.6

2.0

1.4

2.2

1.4

-1.0

0.0

1.0

2.0

3.0

Canada U.S. U.K. France Italy Germany Japan

Perc

en

t (%

)

Real GDP Growth and Projections (%)

According to Consensus

Economics, Canada has

been a strong performer

among G7 countries in

GDP growth during the

2013-16 period and is

expected to continue this

trend through 2017-19.

2013-2016 2017-2019

Source: OECD Economic Outlook, No. 102, November 2017. 5

Other forecasts also highlight Canada’s strong economy…

Similarly, according to the

OECD, Canada’s real

GDP growth from 2013-

2016 ranked high among

G7 countries and is

forecast to be the

highest in the G7 in

2017-2019. 1.9

2.1 2.3

0.9

0.1

1.5

1.1

2.4 2.3

1.3

1.8

1.4

2.2

1.2

-1.0

0.0

1.0

2.0

3.0

Canada U.S. U.K. France Italy Germany Japan

Perc

en

t (%

)

Real GDP Growth and Projections (%) 2013-2016 2017-2019

Source: OECD Economic Outlook, No.102, November 2017. 6

…and Canada leads G7 countries in long-term GDP growth.

Long-term real GDP growth

statistics from the OECD

place Canada at the top of

the G7 over the last decade.

Canada’s real GDP growth is

also well above the EU

average.

1.6

1.4 1.3

1.2

0.7

0.6 0.5

-0.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

Perc

en

t (%

)

Real GDP Growth in G7 Countries (%) 2007-2016

Sources: OECD Economic Outlook, No.102, November 2017 and Statistics Canada, CANSIM tables 282-0087 and 282-0089, May 11, 2018. 7

Canada also has strong employment growth...

Canada’s employment

performance since 2007 has

been a strong second in the

G7.

Canada has recovered more

than all of the jobs lost

during the 2008-2009

recession.

Almost 1,929,600 more

Canadians are working

today than when the

recession ended in June

2009 and employment is

about 1,503,100 above the

pre-recession peak recorded

in October 2008. Over 80%

of the positions created

since June 2009 have been

full-time with over 80% in the

private sector. 0.02

0.12

0.33

0.49

0.86

0.99

1.22

Italy

Japan

France

U.S.

U.K.

Canada

Germany

Average Annual Employment Growth (%) 2007-2016

*Total government budget includes federal, provincial/state and municipal budgets.

Source: OECD Economic Outlook, No.102, November 2017. 8

…strong fiscal performance…

Despite posting a deficit of

1.9% of its GDP in 2016,

Canada’s fiscal position is

still forecast to be better

than most G7 countries

during 2017-2018, with an

overall deficit of 1.5% of

GDP.

-1.9

-2.5

-3.3

0.8

-3.4

-5.0

-4.6

-1.5 -1.9

-2.2

1.3

-2.8

-4.9 -4.5

-8

-6

-4

-2

0

2

Canada Italy U.K. Germany France U.S. Japan

Perc

en

t (%

)

Total Government Budget Balance* 2016-18 % of GDP | National Accounts Basis

2016 2017+2018

Source: IMF World Economic Outlook, April 2018. 9

…the lowest net debt in the G7…

In 2017, Canada had the

lowest net debt-to-GDP ratio

in the G7. It will continue to

hold this standing during the

2018-2019 forecast period.

27.8

45.1

78.2 82.3

87.7

119.9

153.0

27.0

39.8

77.2 82.1

87.0

117.5

151.7

0

20

40

60

80

100

120

140

160

Canada Germany U.K. U.S. France Italy Japan

Perc

en

t (%

)

General Government Net Debt 2017-19 % of GDP

2017 2018-2019

Sources: OECD Economic Outlook, No.102, November 2017 and http://www.bankofcanada.ca/2016/10/renewal-of-the-inflation-control-target-2016/

10

…a low inflation-rate regime…

A low-inflation environment

provides business certainty

to investors. The Bank of

Canada will continue to

target inflation at 2% for

another five-year period.

During the past five years,

Canada has enjoyed

relatively low inflation–

averaging 1.4% compared

to 1.3% for the U.S. and

1.1% for the G7 as a

whole. 1.5

0.9

1.9

1.1

1.4

2.1

1.5 1.6

0.1

1.3

2.0

1.3 1.3

0.3

0.5

0.0

1.0

2.0

3.0

2012 2013 2014 2015 2016

Inflation Year-Over-Year % Change

Canada U.S. G7

* The Legatum Prosperity Index ranks countries based on 104 variables grouped into 9 sub-indexes which are averaged using equal weights. The sub-indexes are: economic quality; business

environment; governance; education; health; safety & security: personal freedom, social capital and natural environment. Source: Legatum Institute, London, November 2017 11

…an overall environment of prosperity…

According to the Legatum

Prosperity Index*, Canada

ranks first in the G7, first in

the G20 and eighth among

149 countries in terms of

overall prosperity, based on

material wealth and personal

wellbeing.

1st

2nd

3rd

4th

5th

6th

7th

Canada U.K. Germany U.S. France Japan Italy

Ran

k

Legatum Prosperity Index* 2017

G7 Ranking

Source: The Social Progress Imperative, June 2017. * The Index is the sum of three dimensions: Basic Human Needs, Foundations of Wellbeing, and Opportunity. Each dimension is made up of

four equally weighted individual components scored on an objective scale from 0–100. This scale is determined by identifying the best and worst global performance on each indicator by any

country in the last 10 years, and using these to set the maximum (100) and minimum (0) bounds. 12

…and a high degree of social progress.

Canada ranks first in the

G7, first in the G20 and

sixth overall in a 128-

country study of social

progress – defined as a

society’s capacity to meet

the basic human needs of

its citizens, establish the

foundations that allow

citizens and communities to

enhance and sustain the

quality of their lives, and

create the conditions for all

individuals to reach their full

potential.

89.8

88.7 88.5

86.4 86.4 85.9

82.6

75

80

85

90

95

Canada U.K. Germany Japan U.S. France Italy

Ind

ex

Social Progress Index* G7 Ranking

A HIGHLY COMPETITIVE BUSINESS ENVIRONMENT

II

Source: The Economist Intelligence Unit, May 2018 14

Canada is acclaimed by the EIU for its superior business climate…

Canada understands the

importance of its business

community and has

created an environment to

encourage its success.

Canada is the 3rd best

country in both the G7 and

the G20 for doing business

over the next five years,

according to the Economist

Intelligence Unit (EIU).

Canada ranks eighth

among 82 countries in the

Economist Intelligence

Unit’s global business

rankings for the forecast

period (2018-2022).

The country ranks well for

its infrastructure, market

opportunities, foreign trade

and exchange and low tax

rates.

1st

2nd

3rd

4th

5th

6th

7th

U.S. Germany Canada U.K. France Japan Italy

Ran

k

Business Environment of the G7 Countries Rank for Forecast Period 2018-2022

*Chart based on analysis of country rankings. Country rankings are based on the following eleven categories of quantitative and qualitative indicators: trade freedom, monetary freedom, property

rights, innovation, technology, red tape, investor protection, corruption, personal freedom, tax burden and market performance.

Source: Forbes Publishing, December 2017.

15

…and by Forbes.

Canada ranked second in

the G20 and stood fifth

overall in Forbes’ latest

153-country annual study,

The Best Countries for

Business.

Canada ranks particularly

well on several study

elements, including degree

of personal freedom (first

overall) and red tape

involved in starting a

business (second overall).

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

Ran

k

Top 10 Countries in the G20 for Business 2018*

Source: Global Infrastructure Investment Index, ARCADIS NV Consulting, May 2016

* Standing among 41 countries. Economic infrastructure is the core internal facility of a country than makes business activity possible, such as communication, transportation, distribution, finance

and energy supply. These assets are fundamental to society and economic growth.

16

Canada has high potential for investment and growth in infrastructure.

Canada ranks first in the G7

and fourth overall in a recent

study measuring a country’s

potential for investment and

growth in its economic

infrastructure.*

1st

2nd

3rd

4th

5th

6th

7th

Canada U.S. U.K. Japan Germany France Italy

Ran

k

Global Infrastructure Investment Index G7 Ranking

Source: Doing Business in 2018 - The World Bank Group, November 2017. *A "procedure" is defined as any interaction of the company founder with external parties (government agencies,

lawyers, auditors, notaries, etc). Interactions between company founders or company officers and employees are not considered as separate procedures. For example, an inauguration meeting

where shareholders elect the directors and secretary of the company is not considered a procedure, as there are no outside parties involved.

17

Establishing a business in Canada involves relatively few steps…

Regulations pertaining to

the creation of new

businesses are

considerably more

flexible in Canada than in

other G7 countries.

Canada ranks first among

the G7 and OECD

countries for the lowest

number of procedures

required to establish a

new business.

2

4

5 5.1

6 6

9 9

0

1

2

3

4

5

6

7

8

9

10

Canada U.K. France OECD Average

Italy U.S. Japan Germany

Number of Procedures*

Source: Doing Business in 2018- The World Bank Group, November 2017 18

…and takes relatively less time.

1.5

3.5

4.5

5.6

6.5

9.0

10.5

12.2

0

1

2

3

4

5

6

7

8

9

10

11

12

13

Canada France U.K U.S. Italy OECD Average

Germany Japan

Time Required to Start a Business Days In Canada, it takes fewer

days to establish a new

business than it does in

any other G7 country.

Source: Finance Canada, January 2018 19

Canada has relatively low corporate income tax rates.

34.4

30.2 30.0

27.8 26.8

25.8

19.0

10

15

20

25

30

35

40

Perc

en

t (%

)

Statutory General Corporate Income Tax Rates in the G7, 2018

Canada has the third-

lowest statutory corporate

income tax rate in the G7

in 2018.

Source: KPMG Competitive Alternatives 2016 20

Canada has the lowest business costs in the digital and research & development sectors.

Percentage Cost Advantage (Disadvantage) Relative to the United States

Canada is the lowest cost G7 country in the Digital and Research & Development sectors.

Of the two industries in the Digital sector, Canada is the lowest-cost G7 country in both the Digital Entertainment and

Software Design industries.

Among the industries comprising the Research & Development sector, Canada is the lowest-cost G7 country in all

three: the Biotechnology, Product Testing and Clinical Trials industries.

27.7

22.4 21.0

16.0

12.8 11.9

baseline 0

5

10

15

20

25

30

Canada France Italy Germany Japan U.K. U.S.

Research & Development

26.0

16.5 14.4

12.2 11.2 11.0

baseline 0

5

10

15

20

25

30

Canada Italy U.K. France Japan Germany U.S.

Digital

9.7

7.1 7.0 6.5

5.0 5.0

baseline 0

5

10

15

Canada Italy U.K. France Germany Japan U.S

Manufacturing

Source: KPMG Competitive Alternatives 2016 21

Canada is also highly cost-competitive among the G7 in the manufacturing and corporate-services sectors…

Percentage Cost Advantage (Disadvantage) Relative to the United States

Canada is the lowest-cost G7 country in the manufacturing sector and the corporate-services sector.

Canada is the lowest-cost G7 country in all 12 manufacturing-sector industries: aerospace, agri-food, automotive,

chemicals, electronics, green energy, medical devices, metal components, pharmaceuticals, plastics, precision

manufacturing and telecommunications.

Canada is the lowest-cost G7 country in both corporate-services sector industries: professional services and support

services.

26.1

20.9

16.7 16.1 15.9 15.7

baseline 0

5

10

15

20

25

30

Canada Italy U.K. Germany France Japan U.S.

Corporate Services

*Standing among 137 countries. Ranking based on the degree of soundness of financial institutions. Source: Global Competitiveness Report, 2017-2018

** Standing among 500 world banks based on total assets and long-term credit ratings. Source: Global Finance Magazine, September 2017 22

…and has sound financial institutions.

Investors can take comfort in

the fact that Canada’s banking

system is ranked 2nd in the

world and is soundest in the

G7.

Five of the world’s 50 safest

banks are in Canada,

according to a recent study**:

• Toronto Dominion Bank (19th )

• Royal Bank of Canada (23rd)

• Caisse Centrale Desjardins (34th)

• Scotiabank (48th)

• Bank of Montreal (50th)

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

Ran

k

Soundness of Banks* World Rank

A DYNAMIC WORKFORCE

III

Source: OECD, Education at a Glance, September 2017 24

Canada has one of the world’s best-educated talent pools and some of the best universities…

Canada's talent pool is the

most highly educated among

OECD member countries, with

over half of its population aged

25-64 having attained tertiary-

level education.

• The 2017-2018 edition of the

U.K.-based Quacquarelli

Symonds (QS) rankings

places four Canadian

universities among the top 100

in the world:

• University of Toronto 31st

• McGill University 32nd

• University of British Columbia 51st

• University of Alberta 90th

56.3

50.5 49.9 46.9 46.0 45.7

43.7 43.6 43.0 42.9 42.8

0

10

20

30

40

50

60

Perc

en

t (%

)

Percentage of Individuals Aged 25-64 Having Attained Tertiary Level Education Top OECD Countries, 2016

Source: IMD, * Rank among 63 economies considered in the World Competitiveness Yearbook 2017. 25

…superior management training…

Canada stands second in the

G7 in a study measuring the

extent to which management

education meets the needs of

the business community (see

chart).

In addition, three Canadian

schools of management rank

among the top 100 in the

world according to the

Financial Times (UK) Global

MBA rankings for 2017:

• University of Toronto (Rotman) 65th

• Western University (Ivey) 94th

• Queen’s University (Smith) 100th

7.59 7.44

6.95

6.51

6.18

5.97

4.69

4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

U.S. Canada Germany U.K. France Italy Japan

Ind

ex

Management Education Quality Index*

Source: IMD, * Rank among 63 economies considered in the World Competitiveness Yearbook 2017. 26

…and a readily available army of qualified engineers.

The availability of qualified

engineers in the labour force

in Canada is greater than in

any other G7 country except

France, according to a

Institute for Management

Development (IMD) survey.

7.78 7.67

7.45

7.25

6.67 6.58

6.03

5.5

6.0

6.5

7.0

7.5

8.0

France Canada Italy U.S. U.K. Germany Japan

Ind

ex

Qualified Engineers Availability Index*

Source: OECD: Program for International Student Assessment (PISA) 2015 – Released December 6, 2016 27

Canada is also a world leader in academic performance among youth…

PISA Score (Points – Standing Among G7 Countries)

Among the three subject areas (reading, science and mathematics) surveyed in the OECD Program for International

Student Assessment (PISA), Canadian schoolchildren rank first in the G7 in reading and second in each of science

and mathematics.

Among the 72 countries and economies that participated in PISA 2015, Canadian schoolchildren ranked 3rd in

reading, 9th in science and 10th in mathematics. The rankings compare to 9th, 10th and 13th, respectively, in 2012.

The annual PISA survey involves a total of over 540,000 pupils in 72 countries and evaluates the capacity of 15-year

olds to understand and solve academic problems.

Country Reading

Canada 527

Japan 516

Germany 509

France 499

United Kingdom 498

United States 497

Italy 485

Country Science

Japan 538

Canada 528

United Kingdom 509

Germany 509

United States 496

France 495

Italy 481

Country Mathematics

Japan 532

Canada 516

Germany 506

France 493

United Kingdom 492

Italy 490

United States 470

*The Global Entrepreneurship Index ranks countries based on 3 sub-indices: entrepreneurial attitudes, entrepreneurial abilities and entrepreneurial aspirations standing on 14 pillars: opportunity

perception, start-up skills, risk acceptance, networking, cultural support, opportunity start-up, technology absorption, human capital, competition, product innovation, process innovation, high

growth, internationalization and risk capital.

Source: Global Entrepreneurship Index 2018 – The Global Entrepreneurship and Development Institute, November 29, 2017

28

…and has one of the world’s best business climates for entrepreneurs.

According to the Global

Entrepreneurship Index*—a

measure of the health of a

country’s entrepreneurship

ecosystem—Canada ranks

second in the G7 and third

among 137 countries.

Canadian policymakers are

better equipped than those in

most economies to

implement policies that

support entrepreneurship

innovation, productivity and

job creation.

84.0

79.0 78.0

69.0

66.0

52.0

41.0

30

40

50

60

70

80

90

U.S. Canada U.K France Germany Japan Italy

Ind

ex

Global Entrepreneurship Index*

G7 Ranking

Source: IMD, * Rank among 63 economies considered in the World Competitiveness Yearbook 2017. 29

Canada is a leader in computer ownership and Internet use.

Canada has a technology-savvy population and workforce. It ranks third in the G7 for the number of Internet users

per-capita and third in the G7 for the number of personal computers per capita.

1173

1032 1021 1014

987

950 940

850

900

950

1000

1050

1100

1150

1200

Ind

ex

Personal Computers Per 1,000 Inhabitants

893

881 876

860

842 839 837

800

820

840

860

880

900

Ind

ex

Internet Users Per 1,000 Inhabitants

A PROMISING VENUE FOR INNOVATION & INVESTMENT

IV

Source: OECD Main Science and Technology Indicators, 2017, Volume 2, March 2018. 31

Canada has a high level of R&D investment in higher education…

Canada is a world leader in

post-secondary research,

outpacing other G7

countries on higher

education investment. 0.66

0.54

0.49

0.41 0.39

0.36 0.33

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

Canada

Germany

France U.K. Japan U.S. Italy

Perc

en

t o

f G

DP

(%

)

R&D Investment in the Higher Education Sector 2016

* Standing based on three dimensions of investor protection: transparency of related party transactions, liability for self dealing, and shareholders’ ability to sue officers and directors for misconduct.

Source: Global Innovation Index 2017, Cornell University, INSEAD Business School, and World Intellectual Property Organization (WIPO) 32

…with solid investor protection…

Canada is ranked second

in the G7 and seventh out

of 127 countries, by the

Global Innovation Index for

the ease of investor

protection.

78.3 76.7

65.0 64.7 63.3

60.0 60.0

40

50

60

70

80

U.K. Canada France U.S. Italy Japan Germany

Ind

ex

Ease of Investor Protection* G7 Ranking

33

...creating a business recognized investment environment.

Canada demonstrates

strong FDI attraction

performance as measured

by FDI stock as a share of

GDP.

54.1 52.0

30.1 29.8 26.8

24.8

17.8

3.6

0

10

20

30

40

50

60

Perc

en

t o

f G

DP

(%

)

FDI-GDP Ratio 2012-2016

Source: UNCTAD Stat Database, August 2017

Note: UNCTAD FDI stock data at market value, measured in US$

* At book value, $CAD

Source: Statistics Canada, CANSIM table 376-0051, April 25, 2018 34

Canada’s globalized economy is driven by a dynamic two-way investment process…

Over the past decade,

Canada has witnessed

substantial growth in both

inward and outward FDI,

reflecting its strong

connection to global supply

chains.

Canada’s inward FDI stock

increased from C$551 billion

in 2008 to C$824 billion in

2017.

Canadian direct investment

abroad (CDIA) increased

from C$642 billion in 2008 to

C$1,121 billion in 2017.

0

200

400

600

800

1000

1200

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Canada’s Inward and Outward FDI Stock* $ Billion

CDIA

FDI

Source: Statistics Canada, CANSIM table 376-0051, April 25, 2018 35

…led by investment between Canada and the United States…

In 2017, the United States’ share of foreign direct investment (FDI) in Canada stood at 49.1%, while the United

States accounted for 45,0% of Canadian direct investment abroad (CDIA).

This demonstrates strong business confidence in cross border investment between Canada and the United States.

United States 45.0%

United Kingdom

9.2%

Luxembourg 6.9%

Barbados 4.4%

Cayman Islands 3.8%

Bermuda 3.6%

Netherlands 2.9%

Australia 2.5%

Bahamas 2.2%

Chile 1.5%

Others 18.0%

SHARE OF TOP 10

DESTINATIONS OF FDI

STOCK FROM CANADA 2017 (%)

United States 49.1%

Netherlands 11.2%

Luxembourg 6.1%

United Kingdom 5.8%

Switzerland 4.9%

Japan 3.6%

Brazil 2.2%

Germany 2.1%

China 2.0%

Bermuda 1.7%

Others 11.5%

SHARE OF TOP 10

SOURCES OF FDI

STOCK IN CANADA 2017 (%)

Source: Statistics Canada, CANSIM table 376-0052, April 25, 2018 * North American Industry Classification System (NAICS) 36

…and overall FDI geared toward industries with strong competitive advantages…

Almost 80% of foreign investment in Canada is in four main industries: manufacturing, mining and oil and gas

extraction, management of companies and enterprises, and finance and insurance.

Manufacturing 21.4%

Management of Companies & Enterprises 20.7%

Mining, Oil & Gas 19.7%

Finance & Insurance

16.6%

Wholesale Trade 9.1%

Retail Trade 4.3%

All Others 8.2%

SHARE OF TOP 6

INDUSTRIES IN

CANADA’S FDI STOCK 2017 (%)

Source: UNCTAD Stat Database, August 2017 37

…making Canada a leader in FDI attraction.

Since the financial crisis

and ensuing global

downturn, Canada has

outperformed major global

economies in attracting FDI:

From 2012-2016, Canada

was the largest recipient of

per capita inflows among G-

7 countries and the second

largest in the G-20 following

Australia.

$6,950 $6,759

$4,046

$1,931 $1,604

$1,123

$188

0

1000

2000

3000

4000

5000

6000

7000

8000

Canada U.K. U.S. France Italy Germany Japan

$ U

S

Cumulative FDI Inflows per Capita in the G7 2012-2016 | US$

EASY ACCESS TO MARKETS

V

Source: Statistics Canada and Transport Canada, 2017

39

Canada has a streamlined trans-border transportation system…

The North American market

is served by a well-

integrated transportation

system, which is among the

world’s best.

Automated permit ports,

transponder-identification

systems and joint

processing centres are

being tested and deployed

for easy movement of

goods.

Bottom line: the border

system is one of the

world’s most efficient.

0

5

10

15

20

25

30

Mil

lio

ns

Annual Trans-Border Crossings Total Number of Trucks and Canada-U.S. Air Passengers

(Two-Way Movements)

AIR

TRUCK

27.2 MILLION

10.9 MILLION

40

MEXICO CITY

LOS ANGELES

DENVER

HOUSTON

ATLANTA

SEATTLE

MIAMI

NEW YORK

BOSTON

PHILADELPHIA

WASHINGTON BALTIMORE

DETROIT CHICAGO

CLEVELAND

ST. LOUIS PITTSBURGH

MILWAUKEE

SAN FRANCISCO

ST. JOHN'S

CALGARY

VANCOUVER REGINA HALIFAX

TORONTO

MONTRÉAL WINNIPEG

CHARLOTTETOWN

EDMONTON

VICTORIA

OTTAWA

WINDSOR

QUÉBEC

FREDERICTON

SASKATOON

500KM

1000KM

Canadian-based

businesses have access to

one market of over 486

million consumers with a

combined GDP of over

US$22 trillion.*

Many Canadian production

hubs are very close to U.S.

markets with 16 of

Canada’s 20 largest cities

within a 1.5-hour drive of

the U.S. border.

…with direct access to the North American market...

* Source: IMF World Economic Outlook, April 2018.

41

…excellent global market access for businesses…

With the Canadian-European

Union Comprehensive

Economic and Trade Agreement

(CETA) provisionally in force,

firms operating in Canada have

preferred market access to 45

foreign countries.

Canada’s preferred market

access represents over 1.2

billion consumers and over

US$43.6 trillion or 54.6% of

global GDP.

Ratification of the

Comprehensive and

Progressive Agreement for

Trans-Pacific Partnership

(CPTPP) will expand Canada’s

preferred market to over 1.5

billion consumers and over

US$50.9 trillion or almost two-

thirds of global GDP.

Canada’s market access is

supported by a reliable and

efficient transportation system,

providing for effective Canadian

business participation in global

supply chains.

Countries and Economic Zones with Free Trade Agreements with Canada, 2017 Gross Domestic Product (GDP) (US$)

Source: IMF World Economic Outlook, April 2018.

42

…facilitated by efficient transport linkages tying North America to Asia and Europe.

Canada’s Gateways offer an

integrated and efficient transport

network that spans from coast to

coast, reaching deep into North

America’s economic heartland.

The Gateways’ strategic locations

offer the most direct routes to

and from Asia and Europe.

Sailing times from Canada’s

Atlantic and Pacific deep-

water ports are up to two

days shorter than from

other North American ports.

AN EXCELLENT PLACE TO LIVE

VI

Source: OECD December 2017 * Index based on weighted average of 11 topics (housing, income, jobs, community, education, environment, civic engagement, health, life satisfaction, safety and

work-life balance) identified as essential by the OECD in the areas of material living conditions and quality of life.

44

Canada’s overall quality of life is one of the world’s best.

Canada ranks first in the

G7 and fifth among the 35

OECD countries in terms of

overall living conditions and

quality of life.

7.78 7.67

7.24

6.95

6.56

5.76

5.49

5.0

5.5

6.0

6.5

7.0

7.5

8.0

Canada U.S. Germany U.K. France Japan Italy

Ind

ex

Better Life Index* G7 Ranking

Source: IMF World Economic Outlook, April 2018. 45

Canada has one of the highest standards of living among G7 countries...

Canada has one of the

world’s highest standards

of living, ranking second in

the G7 and third in the

G20, as measured by

Gross Domestic Product

(GDP) per capita.

$31,984

$38,440

$39,735

$39,869

$44,550

$45,077

$59,501

Italy

Japan

U.K.

France

Germany

Canada

U.S.

Gross Domestic Product per Capita of G7 Countries 2017 | US$

In a recent annual ranking of the quality-of-life in 231 cities, four Canadian cities are among the top 25.

Source: Mercer Human Resources Consulting: March 2018 46

…an exceptional quality of life in its cities…

1st 2nd

3rd 3rd

5th

6th

7th

8th

9th

10th 10th

12th

13th

14th

15th

16th 16th

18th

19th 19th

21st 21st

23rd 23rd

25th

Ran

k

Overall Quality of Life Ranking Top 25 Cities

Ranking based on the Reputation Institute's 2017 Country RepTrak(TM), an annual study measuring the public perceptions of 55 countries around the world. The study measures the overall Trust,

Esteem, Admiration and Good Feelings the public holds towards these countries, as well as their perceptions across 17 different attributes, including a good quality of life, a safe place to live and a

strong attention to their environment.

Source: Reputation Institute, New York, June 2017 47

…and an impressive overall reputation on the global stage.

The Reputation Institute ranked Canada first among 55 countries, based on its good quality of life, a safe place to

live, an advanced economy, an effective government and an appealing environment.

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

Ran

k

Global Reputation* Ranking of Top Ten Countries

*Standing among 163 countries. Index ranking countries based on peacefulness, both domestically and abroad using 22 indicators, including the number of soldiers killed overseas, the level of

violent domestic crimes and relations with neighbouring countries.

Source: Economist Intelligence Unit, June 2017 48

Canada ranks high among model nations of peace…

According to the Global

Peace Index, a recently

released measure by the

Economist Intelligence

Unit, Canada stands first in

both the G7 and the G20

and eighth among 163

countries surveyed.

1st

2nd

3rd

4th

5th

6th

7th

Canada Japan Germany Italy U.K. France U.S.

Ran

k

Global Peace Index* G7 Ranking

*Standing among 167 countries. Index ranking countries based 60 indicators grouped in five different categories: electoral process and pluralism, civil liberties, functioning of government, political

participation and political culture.

Source: Economist Intelligence Unit, January 2018 49

…and vibrant democracies.

According to the Economist

Intelligence Unit’s

Democracy Index, Canada

stands first in both the G7

and G20, and sixth among

167 countries surveyed.

1st

2nd

3rd

4th

5th

6th

7th

Canada Germany U.K. U.S. Italy Japan France

Ran

k

Democracy Index* 2017

G7 Ranking

Source: IMD *Confidence that person and property is protected. Rank among 63 economies considered in the 2017 World Competitiveness Yearbook.

**Degree of fairness of the judicial system in Society. Rank among 63 economies considered in the 2017 World Competitiveness Yearbook. 50

Canada is also a safe and just society…

Canada is a G7 leader in terms of safe places to live and to conduct business under a fairly administered

judicial system.

8.79

8.37 8.30 8.02 7.93

7.78

6.19

5.0

6.0

7.0

8.0

9.0

Ind

ex

Security* World Rank

8.42 8.19 8.18 8.09

7.43 7.20

3.86

2.5

3.5

4.5

5.5

6.5

7.5

8.5

9.5

Ind

ex

Justice** World Rank

Source: IMD *Race, gender, family background does not pose a handicap for competitiveness.

Rank among 63 economies considered in the 2017 World Competitiveness Yearbook.

51

…a land of equal opportunity…

Canada ranks first among G7 countries in providing equal opportunities to individuals.

7.67

6.89 6.69 6.63

6.37 6.18

5.06

4

5

6

7

8

9

Canada Japan U.K. Germany U.S. France Italy

Ind

ex

Equal Opportunity*

World Rank

*Based on mother tongue

Source: Statistics Canada, 2011 and 2016 Census , Released August 2, 2017. 52

…and a society rich in multiculturalism.

Canada has one of the

world’s most multilingual

societies with over 200

languages identified as the

mother tongue

There has been an overall

increase in the proportion

of Canadians whose

mother tongue is neither

English nor French from

21.3% in 2011 to 22.9% in

2016.

58.1%

21.4%

22.9%

Language Distribution in Canada*

English French Other

58.6%

22.0%

21.3%

% OF

POPULATION

2016 Census 2011 Census

Canada’s economic fundamentals and relative cost advantages provide a

first-rate business environment.

Canada offers:

53

Canada: Solid Reasons to Invest

A Highly Competitive Business

Environment Ease in establishing and operating

a new business

Competitive business costs

Competitive tax system

Strong financial and technological

environment

An Excellent Place to Live Superb overall quality of life

A society rich in multiculturalism

Excellent Economic Fundamentals Low inflation

One of the strongest economies in

the G7

Easy Access to Markets Geography provides easy access to the

world’s most prosperous markets.

Highly efficient transportation linkages

with Asia and Europe

A Dynamic Workforce One of the world’s best-educated

internationally-oriented workforces

Quality management training

Technology-savvy workers

A Promising Venue for

Innovation and Investment World leader in post-secondary

research

54

Through Canadian diplomatic missions around the world,

and with direct access to investment contacts at national,

provincial and municipal levels within Canada, the Invest

in Canada Bureau of Global Affairs Canada is well

positioned to assist you with your investment in Canada.

We invite you to start exploring all that Canada has to

offer at: www.investincanada.com

For further information, please contact our

investment specialists at your local Canadian

Embassy, High commission or consulate:

www.tradecommissioner.gc.ca

Or write to us at:

investincanada@international.gc.ca

Think Canada! is prepared by Arif Mahmud, Investment Strategy and Analysis Division, Office of the Chief Economist, Global Affairs Canada