The Canadian economy is a global titan – consistently ranking in the top 10, despite its small population relative to other countries it competes against.
Canada’s size clearly benefits it when it comes to this discussion; the total area of the country is astonishing and it helps the country to produce incredible amounts of petroleum, sawn wood and other goods that it exports globally.
Located in southeast Canada, Ontario is the biggest province by population. Home to the business capital, Toronto, and nearly 15 million people, it makes up a considerable portion of the overall Canadian economy. Today, we will examine the specific factors impacting Ontario’s economy in 2024 and whether they will ripple through the broader Canadian and North American economy.
Business driving economic growth in Ontario
Alongside the petroleum industries that rake in tens of billions of dollars a year for Canadian companies, several other vital industries help to prop up the country: space and aircraft manufacturing, gold and cars.
All of these sectors have helped to drive the Canadian economy for years. As companies search for more sustainable ways to create energy, other businesses have been brought into the spotlight. For instance, the emergence of digital businesses, including casino gaming, has been the torch-bearer for the recent, more positive economic outlook.
The best online casinos in Ontario have been able to drive a lot of economic activity recently, with casino.ca showcasing the type of digital platforms that Ontario-based casino gamers flock to. This has helped to channel a lot of success and economic growth. It is unlikely that casino gaming will become the driving force that will help pull Canada out of the current economic turbulence, however, Ontario flies the flag for digital casinos in Canada, legalizing them in April 2022.
Unfortunately for Canadian casino companies, they’re unlikely to grow to the size of some of the casinos south of the border. As legislation becomes looser and the Canadian economy hopefully rebounds, economists believe there’s a decent chance that casino gaming could continue growing, especially in Ontario, due to its population.
Global economic pressures
Although Canada is a first-world country and economy, it does feel the pinch from global pressures. Even the two most prominent economies in the world, China and the United States, are not immune to wider economic pressures, and there’s a litany of issues that have caused a slump in the wider global economy over the last two years.
Once you throw in a cost of living crisis, inflation and high borrowing rates, that’s not exactly a recipe for bright economic predictions. However, many economists are optimistic about Canada’s chances of a much better economic outlook on the horizon than some of their fellow G8 countries, such as the United Kingdom.
Throughout the West, if prominent economies begin to suffer a downturn, this begins to have a knock-on effect. For instance, inflation in Europe means that it’s more expensive for them to import Canadian goods, so companies that do transatlantic business will be more cautious in their approach.
This is just one of many aspects that have caused the Canadian economy to slow down recently, but it is better positioned to grow again because of the variety and scale of exports it has. In addition, economists believe that inflation rates will also come down in Europe, hopefully leading to more exports for Ontario-based companies and Canada as a whole.
Positives for Ontario’s economy
Ontario economy is estimated at between $800 billion to $1 trillion. The geography of the state is advantageous for both imports and exports. Although it doesn’t share a sea border to the east, it does have direct land access to New York, one of the most prominent states in the US, with one of the biggest natural harbors on Earth.
Ontario is large and shares its land border with the US, so it is a hive of tourist activity. It generates a lot of cross-national business, flowing both ways across the border, and can ramp up quickly to move a lot of its goods into the US.
Again, the location is perfect for innovative companies looking to establish themselves across the North American continent. Given that the Canadian dollar also has a significant presence on the multi-trillion dollar forex market, having a land border with New York – considered the world’s global financial capital – is not too bad for the economy. It’s a one-hour flight or an eight-hour drive, which really isn’t that long at all, given the sheer size of both countries.
Booming tech and AI – where does Ontario fit in?
Ontario remains one of the integral hubs for research and technology investment in Canada. As companies involved in AI, such as Nvidia, drive astonishing levels of growth, Canadian AI firms are scrambling to get in line for some of the astonishing rewards on offer for startup companies in the industry.
AI needs to be approached with caution, and governments and legislators right across the world are in unanimous agreement on this. There’s likely to be some sort of retraction once regulatory measures are announced, which could be as early as the next quarter. Following the trillions of dollars that have flowed into the sector over the last two years, though, it’s probably a reasonable assumption to say that it is the future of the tech industry and will spearhead a lot of prosperity for Canadian-based AI firms in Toronto and beyond over the next few decades.
Ontario economic outlook
To say the global economy has been going through a rough patch this decade would be a significant understatement. Although it’s slowly beginning to pick up, there are still many factors that cause economists and Canadian businesses to be cautious regarding investment and expenditure. The intertwined nature of the global economy, especially in the West, means that they all pull together in the same direction as the US – basically.
As Ontario-based businesses and the Canadian central bank try to gauge the direction of the US economy in a bid to fine-tune their own projections, there’s cautious optimism that the second half of this year will be better for Ontario than 2023 and Q1 of 2024.
While it hasn’t been a particularly rough quarter, all things considered, the overall economic outlook seems to be a little better and more positive than at specific points over the last decade.
Ontario’s provincial economy is worth close to a trillion dollars and has a lot of economic positives that will help the outlook to remain optimistic. Even in the face of a global downturn, its economy continues to show growth.
Ontario and Canada’s economic outlook in general has improved due to the more positive global predictions that economists have been voicing over the last couple of months. While sociopolitical issues could disrupt this projected pattern, many Ontarians will be hoping they can get some semblance of positivity back into their local economy and push toward a brighter economy in the back end of 2024 into early 2025.