Canada
A land of vast distances and rich natural resources, Canada became a self-governing dominion in 1867 while retaining ties to the British crown. Economically and technologically the nation has developed in parallel with the US, its neighbor to the south across an unfortified border. Its paramount political problem continues to be the relationship of the province of Quebec, with its French-speaking residents and unique culture, to the remainder of the country.
Canada's prime minister-elect, Stephen Harper, promised in January 2006 to honor campaign promises of change and reform, after 12 years of Liberal rule. Harper's Conservatives won Canada's general election, but are forced to seek allies in parliament after failing to win an overall majority. The new premier aims to cut taxes, tackle corruption and clamp down on crime. Outgoing prime minister and Liberal party leader Paul Martin announced his decision to step down as party leader after conceding the election to Harper.
Martin had returned to power in a minority government in general elections in June 2004. He headed off a challenge from the Conservative party, but observers said a scandal involving the misappropriation of public money probably cost Martin's party its majority. Regarded as a fiscal conservative, Martin was credited with clearing Canada's large budget deficit in the 1990s.
The Canadian economy is highly developed, giving Canadians one of the highest standards of living in the world. Primary industries built on Canada's abundant natural resources remain an important part of the economy and are a major source of exports. Manufacturing industries, predominantly located in the provinces of Ontario and Quebec, are concentrated in transportation and communications equipment, as well as in consumer goods, engineering and steel industries.
Trade and investment with other countries, especially the United States, closely link the Canadian economy. After expanding 3.3% in 2002, Canada's real gross domestic product (GDP) for 2003 grew only 1.7%. A number of factors contributed to the slowdown of Canada’s economy, such as weak U.S. economic growth for most of the year; a strong appreciation of the Canadian dollar; the SARS outbreak in Toronto; and restrictions on exports of softwood lumber and beef (due to mad cow disease).
However, the recovery of the U.S. economy, high oil and natural gas prices, and continued spending from the Canadian government boosted Canada’s economy in 2004 and the economy continued its healthy growth in 2005. The federal budget deficit was eliminated by the end of 1997. A shift in powers to the provinces already accomplished is unlikely to be undone in the short term. The provinces can be expected to play an assertive role vis-à-vis Ottawa in decision-making on social, environmental and resource-related matters.
One issue that has affected the business climate is the possibility that some day Quebec might vote to separate from Canada. The Parti Quebecois (PQ) advocates sovereignty for the province of Quebec in partnership with Canada. However in recent years opinion polls have indicated a fall in support for independence. Parti Quebecois was defeated in 2003 provincial elections.
Immigration has helped to make Canada one of the world's richest countries, and the country is largely free of racial tension. Many recent newcomers hail from Asia.
There is no specific threat to foreigners in Canada. Nevertheless, the Canadian government began an overall review of the nation's security preparedness in the wake of the September 2001 terror attacks in the United States, including tightening entry requirements.
