Business Blog

by Leah Walker  — Plenty of us are still beaming over Canada’s performance at this year’s Winter Olympic games in Vancouver. Don’t we love that our athletes achieved the most gold medals of any host country in any previous Winter games, and more gold medals than the Americans — thankfully, including hockey — whose country has almost ten times our population.

The swelling Canadian pride helped sell out those cute HBC red maple leaf mittens and made other olympic clothing items as scarce in The Bay and Zellers as snow on Cypress Mountain. But while many of those mittens are now being put away for next winter, the Go Canada spirit has yet to fade.

A commentary from Scotia Capital entitled “Own Canada: The Northern Tiger”, lists 20 reasons the world should invest in Canada. The list was compiled by Scotia economists Derek Holt and Karen Cordes.  In no particular order, I reproduce here 10 of their points:

1) The Bank of Canada will be the next major central bank to raise interest rates.
2) The Canadian dollar is going to parity and beyond against the U.S dollar, and ” the economy will not only survive in this climate as it has before, it will generally thrive”.
3) The Canadian dollar has the edge over the Australian dollar as the Australian central bank is close to finishing its tightening cycle, while the Bank of Canada hasn’t even begun.
4) Canada has the commodities the rest of the world wants.
5) Our country has excellent nonfinancial corporate balance sheets with low leverage and high coverage.
6)  Canada has a universally recognized best-in-class banking system.
7)  Low political risk
8)  No sovereign default risk
9)  Strengths in diversity with a high foreign born population share and strong market ties.
10) A highly educated workforce

Holt and Cordes point out they haven’t always been bullish on Canada but for most of the past year they have recommended over-weighting Canada in portfolios, and the case for over-weighting is still compelling. They say the strengths they list show, in fact, “the country has much of what one would want in both a global portfolio and a physical presence.”  Not that we needed it, of course, but now we have more evidence that Canada is truly gold-medal worthy.