Canada’s economy to perform well over next 50 years, OECD says

OTTAWA — The 21st century may not exactly belong to Canada, but a major world economic body says this country is going to do pretty well.

In fact, the Paris-based Organization for Economic Co-operation and Development sees Canada among the world’s leading economic lights over the next 50 years.

In issuing its long-term view of how it expects world economies to unfold, the OECD says Canada will continue to lead the Group of Seven industrialized economies in average annual growth over the next half century.

And it will also be near the top on a per-capita basis — possibly a truer measure of success — with only Japan sneaking ahead.

The economic research organization, which represents most of the world’s biggest industrialized economies, predicts Canada’s real gross domestic product will average 2.2 per cent growth in the next half century.

Of the other G7 nations, only the U.S. and Britain, with 2.1 per cent average advances, come close.

That doesn’t mean Canada will beat all industrialized nations, however. Australia, New Zealand, Israel and Norway — whose economies are too small for admittance to the G7 club — are projected to experience even stronger average growth rates.

In part, Canada’s superior growth rates are based on

“I think we can … lead the G7, but it’ll be a horse race with the U.S.”

BMO ECONOMIST DOUG PORTER

expectations that its labour force will continue to grow, although more slowly in the age of retiring baby boomers.

“For Canada, it’s a fairly young population, fairly well-educated workforce and you have all these natural resources that give you higher growth than other countries,” said Matthias Rumpf, an OECD spokesman.

The OECD cautions that the projections should be taken with a grain of salt, given the extended timeline horizon. But Bank of Montreal economist Doug Porter said in some ways long-term forecasts are more reliable. Time tends to smooth out short-term shocks, he explained.

“I don’t have a huge quarrel with the conclusion. I think we can or will likely lead the G7, but it’ll be a horse race with the U.S. in particular,” he said.

“I’m not sure I would be as positive on a per-capita basis. Canada hasn’t seen that kind of per-capita gain in the past 30 years and I’m not sure we can really ramp it up in the next 30 to 50 years,” he added.

Overall, the OECD predicts the world will unfold pretty much as it has during the past decade, with the emerging nations, particularly China and India, continuing their march to dominance as economic superpowers.

The OECD says emerging nations and even some industrialized countries like Greece, South Korea and Italy can improve their growth prospects by making structural changes.