Canada is one of the world's wealthiest nations, a member of the Organization for Economic Co-operation and Development (OECD) and Group of Eight (G8). As with other first world nations, the Canadian economy is dominated by the service industry, which employs about three quarters of Canadians. Canada is unusual among developed countries in the importance of the primary sector, with the logging and oil industries being two of Canada's most important. Canada also has a sizeable manufacturing sector, centred in Southern Ontario, with the automobile industry especially important.
International trade makes up a large part of the Canadian economy, particularly of its natural resources. The United States is by far its greatest trade partner, with trade with the United States accounting for about 85% of exports and 59% of imports as of 2004.
Canada is a free market economy, usually seen to have slightly more government intervention than the United States, but less than most European nations[citation needed]. Canada has traditionally had a lower per capita gross domestic product (GDP) than its southern neighbour (whereas wealth has been more equally divided), but higher than the large western European economies. However, Ontario and the West are comparable in GDP per capita to the United States with Alberta having a higher regional income than any state or province in North America. For the last decade, after a period of turbulence, the Canadian economy has been growing rapidly with low unemployment and large government surpluses on the federal level. As such, the Canadian dollar has risen in value against most major currencies during the past five years.
Economic sectors
Canada's huge land mass, the second largest in the world after Russia, a wide array of natural resources are present. Different resources are centred in different parts of Canada. In British Columbia, the forestry industry is of great importance, while the oil industry is central to Alberta's prosperity. Northern Ontario is home to a wide array of mines, while the fishing industry has long been central to the character of the Atlantic provinces, though it has recently been in steep decline.
These industries increasingly become less and less important to the overall economy. Only some 4% of Canadians are employed in these fields, and they account for less than 6% of GDP. They are still paramount in many parts of the country. Many, if not most, towns in the northern part of the country, where agriculture is difficult, exist because of a nearby mine or source of timber. Canada is a world leader in the production of many natural resources such as gold, nickel, uranium, and lead. Several of Canada's largest companies are based in natural resource industries, such as EnCana, Cameco, Goldcorp, and Barrick Gold. The vast majority of these products are exported, mainly to the United States. There are also many secondary and service industries that are directly linked to primary ones. For instance one of Canada's largest manufacturing industries is the pulp and paper sector, which is directly linked to the logging industry.
The relatively large reliance on natural resources has several effects on the Canadian economy and Canadian society. While manufacturing and service industries are easy to standardise, natural resources vary greatly by region. This ensures that differing economic structures developed in each region of Canada, contributing to Canada's strong regionalism. At the same time the vast majority of these resources are exported, integrating Canada closely into the international economy. Howlett and Ramesh argue that the inherent instability of such industries also contributes to greater government intervention in the economy, to reduce the social impact of market changes.
Such industries also raise important questions of sustainability. Despite many decades as a leading producer, there is little risk of depletion. Large discoveries continue to be made, such as the massive nickel find at Voisey's Bay. Moreover the far north remain largely undeveloped as producers await higher prices or new technologies as many operations in this region are not yet cost effective. In recent decades Canadians have become less willing to accept the environmental destruction associated with exploiting natural resources. High wages and Aboriginal land claims have also curbed expansion. Instead many Canadian companies have focused their exploration and expansion activities overseas where prices are lower and governments more accommodating. Canadian companies are increasingly playing important roles in Latin America, Southeast Asia, and Africa. It is the renewable resources that have raised some of the greatest concerns. After decades of escalating overexploitation the cod fishery all but collapsed in the 1990s, and the Pacific salmon industry also suffered greatly. The logging industry, after many years of activism, have in recent years moved to a more sustainable model.
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