1. Canada: The Sustainable Emerging Market
Making the Case for Maersk’s Investment in Canada
By Saili Chisanga
1

2. “An economic miracle”
 The Organization for Economic Co-operation and
Development (OECD) calls Canada “an
economic miracle”.
 The IMF and OECD say that Canada has the best
economic outlook among all G7 countries.
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3. Emerging Markets
 Most Emerging markets have high growth potential, but also high risk
 Risks include: political, monetary and social
 Most emerging countries offer one natural resource
However:
 Canada has the growth potential of an emerging market, with the low
risks of an advanced mature economy
 Canada is resource rich. That is, not one resource, but several
 Lack of political, monetary and social risks, combined with plentiful
resources, make Canada the most Sustainable Emerging Market
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4. Natural Resources
 Canada is the largest exporter of potash
 Canada is the second largest producer of uranium
 Canada is third in proven oil reserves
 Third largest producer of natural gas.
 Fourth largest diamond producer
 3rd largest producer of aluminum
 4th largest in platinum metals
 5th largest nickel producer
 There are more than 50 other minerals and metals that Canada
produces, such as gold, copper, silver, etc
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5. 5

6. Agriculture
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7. Lumber
 USA was our primary market for our lumber exports and our lumber
exports declined with US housing market decline. But now, with the
Chinese demand increase and US housing market poised to pick up in
the coming years; this will be great for the lumber industry in terms of
exports and job creation.
 Timber and agri-food products are arriving in China in increasing
volumes, thanks to the ease of movement made possible by Canada’s
Asia-Pacific Gateway.
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8. Food Industry
 Canada is one of only 24 Net Exports of food. The food sector is
growing and contributes more jobs than automobile and high-tech
manufacturing
 The high level of development of Canada's food industry means
Canadians will not face questions of food security that will plague
billions worldwide in the decades ahead.
 World leader in grain and oilseed – Canola is the next “super-food”,
and demand is growing exponentially
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9. Political Stability
 Canada is 3rd place in political stability and lack of political risk, right
after Norway and Denmark.
 Corruption can add up to 10% to the total cost of doing business and
25% to the cost of procurement of contracts.
 In Canada, we can focus our resources to getting business and not
worrying about political risk.
 Stephen Harper now has a majority government, and so, decisions can
be made more swiftly. There promises to be less “red tape” and an
increase in ease of doing international business.
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10. 2010 Ranking of Political Stability
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11. … Financial stability
AAA
Sovereign Credit Rating
Standard & Poor’s. . . . . . . . . . . . . . . . . AAA 1
Moody’s . . . . . . . . . . . . . . . . . . . . . . . . . Aaa 2
DBRS . . . . . . . . . . . . . . . . . . . . . . . . . . AAA 3
1
Standard & Poor’s Financial Services LLC. Sovereign Ratings 2010. July 2010.
2
Moody’s Investor Services Inc. Canadian Ratings List. July 2010.
3
DBRS Limited. Sovereign Credit Ratings. July 2010.
11

12. Canadian banking system is the soundest
For three years in a row, the World Economic Forum has
named the Canadian banking system the soundest in
the world. 1
At a time when numerous financial institutions around the
world were collapsing, no Canadian bank or insurer
failed. No Canadian bank required a bailout.
1
The World Economic Forum. The Global Competitiveness Report 2008-2009, 2009–2010,
and 2010-2011.
12

13. Free Trade
 Canada is the first G20 nation to implement foreign trade zones (FTZ)
that are geographically flexible.
 Canada provides unsurpassed tariff and Foreign Trade Zone
advantages.
 Canada, whose prosperity is greatly dependent on trade, understands
the importance of open markets for international investors. Canada is
eliminating tariffs on imported manufacturing machinery and equipment
and related industrial inputs such as chemicals, textiles and base
metals.
 This attracts foreign investors and strengthens partnerships with
foreign countries involved, lowers costs of production and
administrative burden.
13

14. Foreign Direct Investment
 Canada’s FDI has been increasing steadily for past 5 years.
 There is a lot of Foreign Direct investment in specific sectors that are
poised for growth.
 FDI in Wood, food, manufacturing, mining and renewable energy are
the highest
 In 2010, Ontario was noted the best Top North American Jurisdiction
for FDI Projects Relative to Population in 2010 with 10 Projects Per
Million of Population
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15. Companies are coming to Canada
Canada’s business environment is much less saturated than the US and
we are seeing a number of retailers and manufacturers moving to
Canada, Target, Whole Foods, Lowe's Home Improvement Centers,
and Lord & Taylor etc
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16. Innovation
 Canada has taken an active role in investing in innovation –Innovation
Demonstration Fund, investing $715milion in investments from
government budget.
 Innovation is what will make Canada competitive on a global scale and
provide more/better ways of doing business
 There is a Ministry of Research and Innovation that facilitates and
gives grants and loans for innovating companies and providing an
incentive for companies to go above and beyond.
 Canada gives tax breaks to companies investing in innovation.
 Grants, loans and tax breaks are meant to stimulate and facilitate the
development of innovative ideas 16

17. … Innovation powerhouse
Vancouver is #1 in North
America for patents filed for fuel cells1
Toronto is #3 in North America
for patents filed in the automotive
sector1
Montréal, Vancouver and
Toronto rank among the Top 10
cities in North America for life sciences
patent filings1
Canada ranks #1 in the G7 for
the number of scientific articles
published per capita2
1
fDi Benchmarking database, fDi Intelligence.
2
Conference Board of Canada.
<http://www.conferenceboard.ca/HCP/Details/Innovation
/scientific-articles.aspx>.
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18. Trade Agreements
 Trade agreements with EU have solidified partnerships with European
countries to eliminate barriers to trade (EU Comprehensive Economic
and Trade Agreement).
 Trade missions to Germany have enabled agreements between the
countries to ship light weight vehicle materials to Canada with no
tariffs.
 Trade agreements with Chile and Japan have recently occurred to
strengthen relations and eliminate trade barriers.
 Ontario government has partnered with China for the Ontario-China
Research and Innovation Fund.
 Trade missions to the Middle East have solidified direct investment in
infrastructure in Ontario and have netted millions in a new partnership
with the region.
 Also there have been trade agreements made with other high growth
emerging markets
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19. Immigration and Small Business
 Immigration – Highest immigration rate and most are
economic immigrants which translate into higher GDP
growth rate (2.3%growth with 100,000 economic
immigrants a year)
 Small Business: 98% of businesses in Canada have <100
employess. 90% exporter are small businesses (<50)
accounting for 21% of GDP.
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20. Substitution Effect
 Recession was an eye opener for Canada.
 Canada has realized that in order to minimize risk and to achieve the
same success attained from the NAFTA agreement; we must diversify
our trade portfolios.
 For the past 10 years, Canadian US imports and exports have been
reducing (CAGR: -2%) with a rapid increase in other foreign imports
and exports.
 As globalization occurs and distance becomes less of a variable in
trade, international trade has increased, and a substitution effect has
ensued.
 While some shipping companies may think of Canada’s strong ties with
US as a disadvantage to business, the opposite is true, as a
substitution effect is in order. New trade lanes have been opened to
other countries.
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21. Sustainability
 Growth Sustainability=Potential for Growth (Profitability) + Low
Risk+ Infrastructure
 Potential for Growth=Sector/Commodity growth, Trade agreements,
minerals, substitution from USA to world countries
 Low Risk= Substitution from USA to world countries, Canada’s
Political Stability, Stable Financial and Fiscal Policies, Trade
agreements
 Infrastructure= Foreign Direct Investments, Government Investments,
Flexible Free Trade Zones, Immigration.
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22. Why is Canada the best place in the G7 to do
business?
The Strongest Economic Growth in the G7
Canada leads the G7 in economic growth. The International Monetary Fund
says that this will continue over the next two years1
The Soundest Banking System in the World
The World Economic Forum says that Canada has the soundest banking
system in the world, followed by New Zealand and Australia2
The Lowest Overall Business Costs in the G7
Canada offers the lowest overall business costs in the G73
1
The International Monetary Fund. World Economic Outlook April 2010.
2
The World Economic Forum. The Global Competitiveness Report 2010 - 2011.
3
KPMG. Competitive Alternatives 2010.
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23. Canada is the Best Place to Invest in the G7
The EIU ranks Canada #1 in the
G7 and #4 in the world as a country
in which to conduct business over the next
five years (2010 – 2014)1
According to the IMF, Canada has the
lowest net debt-to-GDP ratio in the
G7 2
1
The Economist Intelligence Unit. The Business Environment Ranking, August
2010.
2
The International Monetary Fund (IMF). World Economic Outlook April 2010.
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24. . . . Integrated into North American markets
500 km
St. John's
1000 km Edmonton
Québec Charlottetown
Calgary Regina Winnipeg Fredericton Halifax
Victoria Vancouver Ottawa Montréal
Seattle
Milwaukee Toronto Boston
Windsor New York
Chicago Cleveland Philadelphia
Detroit
Pittsburgh Baltimore
St. Louis Washington
San Francisco Denver
Atlanta
Los Angeles
Houston
Miami
Mexico City
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25. … Ease of doing business
One (1) Procedure
It takes, on average, only one
procedure to start up a company
in Canada and the process takes about 5
days. This is the best rating among the
G7 countries
Source: The World Bank Group. Doing Business in 2011.
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26. … Highly educated and multicultural workforce
Canada ranks #1 in the OECD
for its college completion rates
(23.6% of working-age Canadians
have graduated from college)1
Canada ranks #2 in the G7 in
terms of the availability of qualified
engineers in its workforce, according to
the IMD 3
The WEF ranks Canada #1 in the
G7 on the quality of management
schools 2
1
OECD. Education at a Glance 2009
2
International Institute of Management Development. World
Competitiveness Yearbook 2010.
3
World Economic Forum. Global Competitiveness Report 2010-
2011
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27. Multilingual Workforce: 20% of Canadians have a
Mother tongue other than English or French
Canada’s Workforce By Mother Tongue, Number Of Working Age People
French
4,786,640
Other Languages
4,407,615
Chinese 772,040
Italian 280,610
Spanish 270,705
Punjabi 253,315
German 241,630
Arabic 195,735
Portuguese 170,400
Polish 153,325
Korean 99,655
Hindi 60,600
English Japanese 26,965
12,395,670
Source: Statistics Canada, Census 2006.
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28. Canada has the Lowest Cost Structure in the G7
Lowest
In 14 of 17 sectors analyzed in
KPMG’s competitive alternatives
2010, Canada has the lowest
overall business costs
in the G7
Source: KPMG. Competitive Alternatives 2010.
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29. Canada offers your company Duty Free Manufacturing
0%
In Budget 2010, the Government of Canada
announced that Canada will eliminate all
remaining tariffs on manufacturing inputs
and machinery and equipment by 2015.
Canada is the first country in the
G20 to do so.
Source: Government of Canada. The Federal Budget 2010.
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30. Questions
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