Located in the North-Eastern region of the North American continent, Canada is the second largest country in the world after Russia in territorial size. It borders only one country: the United States of America to the South and touches three oceans: the Arctic, the Pacific and the Atlantic. Canada became an autonomous state in 1867, after its emancipation from UK. Its capital city is Ottawa and has a population size of over 34 Million people.
National Differences in Political Economy
In terms of political System, Canada became a constitutional Monarchy in 1867 through the British North America in 1867with its sovereign being the current Queen Elizabeth II of UK. It is also a federation, with political powers divided between the central government and the 10 provinces. The system of government is parliamentary with two houses: House of Commons who are elected and the Senate who are appointed by the Prime Minister.
Being among the top 15 most advanced economic nations globally, Canada adopted a mixed- oriented economy which has transformed it profoundly from a largely rural into an urban industrial following impressive revamping of the manufacturing, mining, and the service sectors after World War II. The Canadian legal system is very unique as it base on its two colonial languages: English and French. Except for the Province of Quebec which follows Civil law since 1759, the rest of the country is under English Common law.
Differences in Culture
Canadian culture is an embodiment of the artistic, literary, humor, musical, political, culinary, and social elements that are characterizes Canada and its citizens. Some of the factors that define the Canadian Business etiquette include meeting and greeting which is informed by detailed etiquettes as handshaking during arrival and departure, men offering their hand to women first, not using honorific names an titles, exchange of business cards after initial introduction, and maintaining eye contact while shaking hands; Canadian communication style which includes using spoken words more than non-verbal communications; and business meetings’ conduct such as substantiating claims with facts and figures, open space for opinion sharing, and minimal small-talk before meetings.
Determinants of Canadian culture include language where French and English are the only officially recognized languages amongst a multitude of other languages; regionalism which is dawn from the various provinces, for instance, while people in Ontario tend to be business-minded and conservative, those in British Colombia are less conventional; race since Canada is a country of immigrants; religion where 77% of Canadians are Christians and general society highly secularized; general attitudes such as pride in shared cultural heritage, value honesty, tolerance, independence, and teamwork, and admire educated, skilled and modest people; and Family which is the center of the society.
Government intervention in Markets
Being a market-based economy, the role of the government in controlling supply and demand is very minimal. The government only plays a key role in policy making which ensures stability to the economy. For instance, the various government departments and agencies provide financing such as contributions, subsidies, loan guarantees and grants to boost savings, investment and equity. Besides, the department of Finance evaluates existing taxes and tariffs and researches for new policies that will serve its economy well, for example, the government is in pursuit of tariff liberalization with certain countries so as to bolster interstate trade and tariff relief to benefits its consumers.
The government has also instituted a policy on import quotas so as to regulate the amount of imports coming into the country and in the process enhancing domestic industrialization to substitute for imports from abroad. To ensure high quality and global standardization in line with World Trade organization rules, the Canadian government has instigated content requirements for all local products with renewable energy being the latest. The other forms of intervention measures include economic sanctions on rogues states, exchange control, voluntary export restraint and bureaucratic export procedures amongst others.
The main economic reasons for intervention by Canadian government include to protect local infant industries, to ensure balance of payments, to protect domestic production of strategic industries i.e. nuclear and armament which are critical to national security of the country, foster foreign investment, liberalization of foreign currency market like recently following the 2009 financial crisis which led to devaluation of Canadian currency, and price stability. Politically, intervention by government could be price stability to ensure that citizens have access to basic services and also through tariffs or sanctions to get back to an enemy state.
Regional Economic Integration
In the spirit of free trade, Canada has joined several regional economic blocs to ensure free flow of goods and services thus better trading environment with its neighbors. Together with USA and Mexico, Canada is a member to the North American Free Trade Alliance (NAFTA), Asian Pacific Economic Cooperation (APEC), Organization for Economic Cooperation and Development (OECD), G20, and the group of agricultural exporting countries in the world called CAIRNS.
At multilateral level, Canada is a member to the IMF and World Bank which are the twin financial institutions mandated with overseeing economic policy reform and financing, a member to World Trade Organization which promotes world economic development by harmonizing global trade rules, and also a member of the UN which has a economic organ (ECOSOC) concerned with international economic development.
The main factors integrated in regional economic blocs to whom Canada is a member is free movement of factors of production across borders like in NAFTA which is established by a free trade agreement or in APEC and OECD created by a preferential trade agreement. There is also the convenience of a common market within NAFTA states which has been created by the abolition of all forms trade tariffs or reduction of trade barriers amongst integrating states as in CAIRNS, APEC and OECD. The other factor is a custom union, which is achieved upon establishment of common customs policy by integrating states towards each other, and different but same custom policy exercised towards outsider states.
The main motivations for integration include: to foster relations with neighboring states, ensure a wider market for products hence ensuring that industries optimize on the scale of economies opportunities, ensuring diversification of consumer products and services, bolstering interstate trade thus improved national and regional economic development, and fostering cooperation in non economic areas such as human rights monitoring, war on terror, curbing human and drug trafficking amongst other social, political and cultural issues,
In a nutshell, Canada is an economically viable, technologically advanced, politically stable country with a diverse culture that provides all the opportunities for a company intending to invest in the country. Any company intending to invest in this advanced nation should however conduct detailed market screening on strategic location within the 10 provinces, existing trade policies of Canada with regard to the trading product of the company, the possible market for its products within Canada, regionally and even globally, infrastructure network from source of raw materials and to markets, level of industry competition, the taste and the preferences of consumers in this nation with diverse population, and security given the global threat of terror and other insecurities.