Sunday happy. In the 2023 column, I asked Why was Canada not an economic giant. The public sparked over 600 comments.

The North North American nation is the subject of the newsletter for this week. The close view of the near range of the Canadian economy is not great. The proposed US tariff can reduce 25 percent on the goods from Canada GDP growth by 4 percentage points over a period of two years (assuming that it comes into effect and Canada retaliation), according to Canada Bank estimates.

But in this edition, I take a decades -long view, on the pretext that with an ambitious political agenda, the G7 result can become a major economic power.

First, a word about its potential.

Canada is the second largest country in the Earth’s mass, with the longest coast in the world. It was booked by the Pacific Ocean and the Atlantic Ocean, which makes it perfect for global trade.

Marko Babtetek, BCA Research, believes that Canada can be better in a warmer world. He said: “The global warming can increase agricultural revenue, and opens large areas of the country to mineral exploration, and allowing new commercial methods through the Arctic.”

The country is independent of energy, with the world’s largest high -quality uranium deposits and the third largest installed oil reserves. It is also the fifth largest natural gas producer.

Canada is proud of huge supplies from other commodities as well, including the largest potash reserves (used to make fertilizers), more than a third of the world -based forests and five fresh water on the surface of the planet. In addition, it contains an abundance of cobalt, graphite, lithium and other rare Earth elements, which are used in renewable techniques.

Papic added: “Canada definitely has the ability to be a global superpower.” But the nation was lacking in the framework of leadership and the political framework to benefit from its advantages.

However, the threat of US President Donald Trump has turned the Overton window. There is now an increasing political consensus to cancel the economic capabilities in Canada and reduce its dependence on exports to its southern neighbor. This task will decrease to Prime Minister Mark Carney or opposition leader Pierre Bolilifer after this year’s elections.

Canada’s gross domestic product has long followed its peers in the Group of Seven, as it ranked 16th globally in the terms of energy equal. A country with its geography can be born clearly. To do this, the Canadian economy needs to become more efficient, increase investment and attract more highly skilled workers. Here is how.

The mountainous terrain in the country impedes its dynamism. But Canada puts great bureaucratic burdens on the movement of people and goods as well. This includes restrictions on the sale of some goods across the borders of provinces, changes in licenses and technical standards that hinder the scaling and competition and allocating effective resources throughout the country.

For evaluation, export Canadian provinces to America more than they do. Study 2022 by McDonald Lorieer Institute I found that the Canadian economy could grow by 4.4 to 7.9 percent in the long run – up to $ 200 billion annually – if internal commercial barriers are canceled through mutual recognition policies. Similar reforms in Australia in the 1990s helped enhance productivity there.

In the face of the threat of American definitions, consensus appears at the boycott level. Angus Red survey found that 95 percent of Canadians now support the removal of internal commercial barriers.

Simplifying its complex tax system, speeding up planning operations, and alleviating the red tape of foreign direct investment and developing the economic partnership mechanisms of the indigenous population, in conjunction with internal trade reforms, would help companies through the industrial supply chain in vast energy and mineral resources in the country.

Canada can play an important role in meeting the global demand for natural gas and uranium (used in nuclear reactors) and rare Earth’s minerals, especially since renewable energy and defense sectors flourish. The country’s natural resources, as well as their capabilities in highly valuable production and refinement activities, are also valuable assets as countries consider diversifying their supply chains from China and Russia-and even the United States.

The development of natural resource groups throughout the country will support the related economic activities, including advanced manufacturing, financing, research and development. This means strengthening communication to support Asia and Europe trading outlets. Currently, about three quarters of Canadian goods exports go to America. (Any future, the American administration will be the most friendly bonus.)

“Canada should continue to build the coast of the trade and energy infrastructure, including ports, roads, railways and pipelines,” says Varun Srivatan, director of politics at Royal of Canada Bank. The country ranks 103 out of 113 for the port’s transformation times, according to World Bank.

After that, people. Its population is only 40 million, Canada is one of the lowest populations in the world. But significantly, it also has one of the worst lack of housing in the world. The average house prices have doubled three times in the past two decades, as mortgage debts have risen in consumer spending.

This is the problem of demand and supply alike. Immigration jumped during the era of former Prime Minister Justin Trudeau, which helped expand the scattered labor market in the country. But he also tense the general infrastructure, which did not develop at the same pace.

The most strict migration controls will provide temporary delay. But with aging in the population and a relatively small labor force, Canada needs to continue to attract talents in the long run. (Artificial intelligence and robots – that require investment – cannot go to this extent.)

This should not be very difficult. Canada outperforms the Mediterranean Index of the Best Life Index, the Organization for Economic Cooperation and Development in Education, Health and Life. Calgary, Vancouver and Toronto are among the best cities to live in. Canada is the most attractive destination in the world of the university, according to what it mentioned EconomicWhich is estimated at 17 million graduates who will move there if they can.

The construction of more homes will ensure that it is still attractive and affordable for local and international workers. (Canada does not use migrant skills as much as possible. Coordinated and coordinated recognition of foreign accreditation data will help, as the Organization for Economic Cooperation and Development notes.)

This is not a comprehensive list of policies. But they should be among the long -term priorities for any Canadian administration seeking to take advantage of the potential and valuable capabilities in the country.

Does Canada have money? It has the lowest debt and net deficit levels as a percentage of GDP. Therefore, enhanced investment of growth can be funded in part by borrowing. But the total debt is high.

Canada also possesses large-level capital gatherings and experience in the global “MAPLE Eight” (largest pension utensils) overseeing 1.6 trillion in assets. They can support lucrative capital investment in the country. Natural resource revenues can be directed to a sovereign wealth box as in Norway with the purchase of provinces. As long as the infrastructure and the less red tape can be able, the foreign direct investment will be abundant.

Canadian economy at a crossroads. The aggression of its main commercial partner leads the consensus on strengthening the national economy. The world needs what Canada has an abundance. The nation has a unique opportunity to reach its potential. If he wants it.

refute? ideas? Send me a message in Freeelunch@ft.com Or on x @Teapperikh90.

Food to think

Here is another possible interpretation of Britain’s productivity. Kallum Pickering, chief economist at Peel Hunt, ran An interesting analysis This links the low electricity supply to the growth of weak productivity in the UK. Can Britain be simply lacking energy to grow faster?