investment final project

8/3/2019 Investment Final Project

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INVESTMENT AND PORTFOLIO MANAGEMENT

1 SUPERIOR UNIVERSITY

PROF. MUHAMMAD FAROOQ MC10225

MUHAMMAD USMAN ASAD


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I am extremely thankful to ALLAH almighty that has enabled

me to complete the thesis on time and in the manner it was

required. He provided me the resources to capture the

knowledge and avail the opportunities in the world. It is also a

matter of immense pleasure for me to express my gratitude to my

teacherProf. Habib Asghar who has been a source of real

inspiration for me. His experiences ford an important part in

this Assignment. His guidance provided me to step aheadtowards my objective in a proper way.


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According to World Development Indicators (WDI) Group World Bank in 1980, production

generated by the services industry was approximately 58% Canadian and Canada Gross

Domestic Product (GDP) by 2001 and has held a number that increased to about 65%. During

the same time period 20-year-old, has a percentage basis, production in agriculture and

manufacturing industry after sitting with little growth.2

Although an external environment is extremely complex. The Canadian economy outperformedpeers in G7 many aspects. Survived the financial and economic crisis better than mostindustrial systems of countries and a shift are impressive. GDP grew a real 4.9 %( annually) inthe quarter-finals in 2009 and 5.6% in a resounding in the first quarter of 2010, fueled bystrong recovery in consumer spending and residential investment and government expenditures.

3

After the acute treatment, the Canadian economy has lost some of his arrogance expanding at a

slower pace of 2.3% in the year 2010 and a poor second annual 1% in the third quarter.

Moreover, the pace slowed dramacately in the creation of the second half of the year.

In 2011, strong head wings, slow growth of US and Canadian dollars continued strength,

undecided domestic demand and diminishing the impact of previous fiscal and monetary

stimulus will hold back growth of GDP. In general, Canadas economy is designed to expand a

modest 2.4 %( year over year) in 2011, after a gain of about 2.9% in 2010.

Canadian economy is guzzling along but his engines are changing. The main two sources that

powered rapid growth earlier in the cycle consumer spending and housing activity are cooling

down. His debts burden of house holds points to moderate further over the forecast period. In

addition economic activity in 2011 will be goes as federal and provincial governments limit

fiscal incentive and then step up their efforts to limit costs. We look for business investment to

make a significant contribution to growth in 2011 and also 2012.

FINANCIAL STRUCTURE OF CANADA:

Financial Stability Assessment Report of the Canadian structure, this update on a normal basis

for discussion with Member States as a reference, the International Monetary Fund (IMF)

prepared by a team of employees. It is January 15, 2008 will be completed at the time of day

depends on the information provided. The views expressed in this article are those of the team

staff, the Canadian government or the executive Board of the IMF does not reflect his views.

The Canadian financial sector is one of the worlds most developed. The institutions, markets,infrastructure, safety nets and supervision regulations which include system are demanding and

include full range of financial intermediaries. Canadian financial and capital markets trade a

wide range of stock, bonds and derivatives instruments in quantities of material, the support of

2http://www.canadianservicescoalition.com/CanadianServicesSectorANewSuccessStory.pdf

3www.wikipedia.com
http://www.canadianservicescoalition.com/CanadianServicesSectorANewSuccessStory.pdfhttp://www.canadianservicescoalition.com/CanadianServicesSectorANewSuccessStory.pdf


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modern clearing and settlement systems. The Canadian authorities have executed the key

recommendations of2000 FSAP.

Five major banking groups that form the hub of the system are conventional manage and more

profitable. They strong risk based capital ratios, modest return on assets and return capital

higher. However, "widely held" rule for large banks limits the concentration of ownership ofbank shares and so the scope for mergers and foreign entry by acquisition. The legal framework

has enabled Canadian banks focus on their franchises profitable retail sales violence, leaving

many large families borrowers to look abroad for funding. Strategies majority of Canadian

foreign banks focused on retail markets, mainly in the United States and the Americas. Stress

tests show that the major Canadian banks are able to with stand wide range of shocks. These

banks are exposed to the frights set their common through United States domestic and business,

and through the Caribbean.

In the main stress situation, which requires an intense slump, some banks to fall below the

minimum capital the regulatory but remains sufficient? Although credit risk remains centralchallenge, worldwide financial turmoil since mid-2007 has highlighted the information and

liquidity risks surrounded in structured financial products that Canadian banks have embraced in

recent years, and write downs have started. Weakness may result from the efforts, relying on a

safe position of the country, to enter the extremely competitive foreign markets or compound

activities, such as sometimes been the case in the past.

Canada's institutional strength and strong structure for macroeconomic policies have maintained

a solid growth and inflation performance. Real GDP increased by about 3% per year on average

over the past decade. Inflation targeting has secured inflation expectations and keeps close to 2

% target. Canada's federal government has registered ten annual surpluses in a row, and currentaccount balances have improved sustainable net international investment position over the last

decade. Even though the economy is diversified and Canada, a number of big product and part of

Canada's exports to the United States notes the frequent external shocks linked.4

The economy rose by 3.1% in 2010 and is growing at about 2.8% in 2011. The economy is

expected to grow at about that pace during the next few years. While Canada is heavily

influenced by the current state of the weak U.S. economy, the strength of future growth in

Canada will be dictated, at least in part, by the growth of U.S. economy.5

4http://www.tfsa.ca/downloads/resources/IMF.pdf

5http://www3.ambest.com/ratings/cr/reports/canada.pdf
http://www.tfsa.ca/downloads/resources/IMF.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www.tfsa.ca/downloads/resources/IMF.pdf


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BANKING SECTOR AND ECONOMIC GROWTH OF CANADA:Financial services sector in Canada is a key provider to economic growth and safety. Banks are

the key taxpayer, progressive employers and major purchasers of goods and services from

Canadian suppliers and are good business citizens and Canadians recognize the importance of

industry in the economy. Three-quarters (76%) of Canadian I believe that banks are doing an

important job to contribute to Canada's economic recovery. And almost nine-in-ten (87%)

Canadians continue to believe that a strong banking sector that is able to compete on the

international scene and support of Canadian businesses is significant.

Relationships with banks have almost two million small businesses, offering products and

associated services and accounts merchant payment processing solutions downloads wage and

International Trade Services. Banks also give funding, as a game still wide various alternate

financing providers. Canada's banking industry is one of the highest taxed sectors in the country.

Banks six largest Canadian paid in taxes $ 8.3 billion all levels of government in Canada in

2010.

The financial services sector plays a critical in a market economy, providing a means for

channeling the various savings and investment opportunities driving growth. It provides needed

capital for growth of existing businesses and start the essential capital for new businesses. It also

allows governments to finance new debt issues and support programs and services. At the same

time, the sector facilitates Canadians to conduct their financial transactions daily, including

savings wealth management, and insurance against risk and unpredicted events. Sector is also an

important contributor to Canada's economic growth and job creation. It employs over 600,000

Canadians and runs an annual payroll of over $35 billion. In addition, the sector represents 6%

of GDP in Canada and gives close to $13 billion in taxes to all levels of government.

Canada's banks and their subsidiaries to contribute significantly to employment and job creation.

In 2010, banks employ 267,240 Canadians. Industry employment has increased by 11.5 %

during the past ten years, while full-time industry increased by 21.5 % during same period. Both

the quality and number of jobs are constantly high in the banking industry. Full time jobs

amounted to 78.9%, the highest it has been in the last 17 years.6

An interesting feature of the financial crisis of 2007/2008 was an outstanding achievement

Canadian banks weathering compared with banks in most other countries. Canada was the only

G7 country without a plan, the government bank. Canadian banks remained profitable through

the crisis. A report by the World Economic Forum ranks Canada first among 134 countries onthe soundness of its banks.

6http://www.cba.ca/contents/files/backgrounders/bkg_banksandeconomy_en.pdf
http://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www3.ambest.com/ratings/cr/reports/canada.pdfhttp://www.cba.ca/contents/files/backgrounders/bkg_banksandeconomy_en.pdfhttp://www.cba.ca/contents/files/backgrounders/bkg_banksandeconomy_en.pdf


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Canada was very welcoming for its performance, including from U.S. President Obama, who

noted: Canada has shown itself to be a very good manager of the financial system and economy

in ways that we have not always been.Newspaper headlines like: "What can New York learn

Toronto and London" spread?

The two arguments concerning the two problems go beyond, but quite distinct with suchtransfers. The first is the consequence of local condition, history and broader social structure:

Canadian Banking Practice of recent years have not only results choices made by bankers and

regulators in those years, but she also worked critically within a Canadian government that had

evolved in a very long time in review can illustrate lessons from Canadian practices, it is

important to take into account the importance of from these diverse circumstances in Canada and

to a different place.

The second complexity is that the Canadian financial system, as with other national financial

systems, there is a special island where the national government and business practices can be

self-8 plan 2007 disaster created in the United States and subsequently spread unsuccessfullythough many other national authorities. Official business and all stakeholders particular national

jurisdiction increasingly activate within a larger international system in which they have

common interests and responsibilities. Thus, a practice that worked well in the Canadian context

may be best to change if the benefits to Canada worldwide coordination for another practice

larger than pure national benefits of existing practice. The paper will argue that the bank fees,

which the Canadian government has objected on the grounds that they are not required in

Canada, are a good example of this. More generally, there are lessons to be learned not only to

Canadian practices, contacts with local Canadian perception, but also for interoperability of

Canadian practices with international practices. These lessons are essential for developing

countries which consider their relationship with these rapidly evolving transnational practices.7

Canadian financial system is based on five main groups: real estate banks trust and loan

companies, co-operative credit movement, life insurance companies and securities dealers. These

groups activities are differentiated by their core business and, to a lesser extent, by the

jurisdiction under which they are supervised, including federal, or provincial, or a combination

of both. For example, banks are under exclusive federal jurisdiction for its banking and trust and

loan and life insurance companies can be involved through either federal or provincial

documents.

Chartered banks are involved and supervised by the federal government and have always beeninvolved in commercial lending. Since mid 1950, they have become important sources of

personal loans and housing mortgage loans. In addition, over the years, banks have developed

substantial business operations globally.

7http://www.nsi-ins.ca/english/pdf/Canadian%20Banks%20(tony%20porter).pdf
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Faith and credit institutions tend to specialize in housing mortgage lending and deposits.

Incorporated federal and supervised large institutions organize the assets in the financial sector

industry, but some companies operating in provincial documents. All are subject to diverse

provincial licensing. In 1980, these institutions moved forcefully into consumer lending and

definite types of commercial loans. As well, trust companies are the only institutions allowed to

provide unlimited confidence.8

Differences in banking systems today are set in place in the early 19th century. Canada (at the

time of a group of British colonies) adopted a small number of bank branching and continues

today to have a nationwide bank branching over 19 the century the number of banks has

increased, peaking in 1874 at 51. Then a series of bank amalgamations and failures decreased the

number to 10 by 1928. Even when the bank was relatively Canada system before 1920 was

concentrated in 5 largest banks holding 80% or more system assets. Coordination (to the extent

that it is not clear in the record) was facilitated the Canadian Bankers Association is an industry

group founded in 1890 and given legal responsibility for the supervision of clearing houses by

the 1900 Bank Act. Canadian banks were the only simply adjusted.

Canadian banks were the only easily adjusted. They had the right to issue notes (post- 1870

records only the name of greater than 4 $) against total assets, depending on this application note

case is less than paid in capital. Entering the industry was limited by the need for a card and

documents provided earlier imposed a dual responsibility of stock ownership. After

Confederation (1867) bank charter restorations were coordinated to happen every 10 years by a

renewal of the Bank Act to include small changes frequently.

Canadian Financial Systems Until the mid 20th century was built and regulated, it was known to

be driven around four pillars: banking, business trust, insurance and securities act. Each pillarafter a particular line of business and its regulator, the federal estate and trust banking and

insurance companies were regulated by a federal agency and others being regulated by a

provincial authority.9

During the years 1970 and 1980, as in Canada, industrial, economic shocks and liberalization

considerably changed the banking environment in the United States and move towards and

national interstate banking began with earnest. Financial institutions improvement and revival

enforcement Act of 1989 (FIRREA) contributed to this fashion by allowing BHCs to make

savings and loan companies, conditional on certain standards.10

8http://www.bankofcanada.ca/wp-content/uploads/2011/06/fsr_0611.pdf

9http://eh.net/eha/system/files/Bordo.pdf

10http://www.cemla.org/pdf/redxi/red-xi-013.pdf
http://www.bankofcanada.ca/wp-content/uploads/2011/06/fsr_0611.pdfhttp://eh.net/eha/system/files/Bordo.pdfhttp://www.cemla.org/pdf/redxi/red-xi-013.pdfhttp://www.cemla.org/pdf/redxi/red-xi-013.pdfhttp://eh.net/eha/system/files/Bordo.pdfhttp://www.bankofcanada.ca/wp-content/uploads/2011/06/fsr_0611.pdf


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BIG INDUSTRY OF CANADA:Oil production in Canada is a major industry which is important for the North American

economy. Canada is the sixth largest oil producing country in the world. In 2008 it produced an

average of438,000 cubic meters per day (2.75 million bbl / d) of crude oil, crude bitumen and

natural gas condensate. Of that amount, 45% was conventional simple oil, 49.5% had bitumen

from oil sands, and 5.5% was condensate from natural gas wells. The majority of Canadian oil

production, about 283,000 cubic meters per day (1.78 million bbl / d) was exported, almost all of

it in the United States. Canada is the largest source of oil imports only in the United States.

Oil industry in Canada is also referred to as the Canadian "Oil Patch", the term refers

particularly to upstream operations (exploration and production of oil and gas), and to a lesser

degree of downstream operations (refining, distribution and sale of oil and gas products). In

2005, almost 25,000 new oil wells were drilled in Canada. Every day, over 100 new wells were

spud in the province of Alberta only.

Canadian oil industry developed in parallel with one of the first United States. Canada was

unearthed by hand (rather than drilled), in 1858 by James Miller Williams at its blacktop plant in

Oil Springs, Ontario. At a depth of20 meters (66 ft), he struck oil a year before the "Colonel"

Edwin Drake drilled the first oil well in the United States. Williams later went on to found

"Canadian Oil Company", which is considered as the first company in the world integrated oil.

Oil production expanded quickly in Ontario, and virtually every major manufacturer became its

refineries. By 1864, 20 refineries were operating in Oil Springs and seven in Petrol, Ontario. On

the other hand, Ontario's status as a major oil producer does not last long. By 1880 Canada was a

net importer of oil by the United States.11

Largest public company in Canada is the Royal Bank of Canada. Royal Bank of Canada has

general rights to its stuck at Manulife Financial as Canada's corporate huge, along with our new

annual list of major companies in the public world. Royal Bank ranks 77th overall, up six places

from the list of2006 and 14 before the insurer Manulife. Last year, Manulife comes from just 10

countries, 93.12

These largest industries and companies have immense impact on the financial structure and

economic growth of the Canada. Due to good and excellent quality products of these industries

the people wants to buy or purchase the products of these industries and companies.

11www.wikipedia.com

12http://www.forbes.com/2007/04/05/canada-public-companies-biz-07forbes2000-cx_0405canada.html
http://www.forbes.com/2007/04/05/canada-public-companies-biz-07forbes2000-cx_0405canada.htmlhttp://www.forbes.com/2007/04/05/canada-public-companies-biz-07forbes2000-cx_0405canada.html


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FINANCIAL CONTRIBUTION OF BANKING SECTOR TO THE

INDUSTRY OF CANADA:

Strong banks are needed more than ever to help families buy a home, to help Canadians not

including retirement, to help small businesses grow and increase, and to help pass the Canadian

international brands that country is a country great to do business. Banks also provides interest

free loans to the industry sector which are very useful for the economy structure of the Canada.

Canadian banking industry employed nearly a quarter of a million people in Canada and while

on PEL 500 in the banking industry represents 0.81% of all employees in the PEL, banking

sector generates 2.3% of the province GDP. To support our employees and constantly improve

the quality of service we offer our clients, banks invest Canada over $1500 a year on training

employees.

Canadian Banks secured over $760 million in consumer credit to the Islanders in 2004 and PEL

families currently benefit from nearly $ 1 billion in outstanding residential loans from Banks ofCanada. Banks also provided about $ 1 billion in loans authorized in the 4800 PEL businesses in

2004, most of which were small and medium enterprises.

Further, Canadian banks donated more than $125 million to Canadian charities in 2005, of which

over $500,000 went to PEL In fact, there was a three-fold increase in charitable banks donations

since 1995. The financial services part plays a serious task in a market economy, ensuring means

of channeling savings into diverse investment chances and heavy economic growth. It provides

needed capital for growth existing businesses and starts the essential capital for new businesses.

Governments use the financial services part to finance new debt issues and sustain programs and

services.

Canadians to conduct their transactions and financial daily including chequing savings and

wealth management, and to provide risk and unexpected events. The financial services sector can

be seen as the "engine" of the market economy, meeting the financial needs of governments,

businesses and individual Canadians.

The financial services sector is an important donor to economic growth of Canada, employing

more than half a million Canadians with an annual payroll of about $ 24 billion. In addition, the

sector represents about 5% of gross domestic product of Canada and contributes about $9 billion

in taxes to all levels of government.13

Financial services industry, which includes an excess of institutions such as banks, trust

companies, joint fund providers, insurance companies, investment houses, and credit unions, is a

vital and dynamic component of the Canadian, and indeed of any industrialized economy. Its

13www4.fsa.ulaval.ca/.../Secteurcanadienservicesfinanciers.pdf


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importance to the Canadian economy cannot be understated. In 1997 alone, the property industry

as a whole maintained more than 2trillion U.S. dollars with profits exceeding $15 billion.

To understand the structure of Canadian banking system, it is necessary to recognize the

differences between Schedule I and Schedule II banks. The differences between the two types of

banks successfully means that Canada has two national banking systems consisting of a ScheduleI banks and many smaller, regional or sector-based slot banking banks. What is not clear in the

data, however, is that Schedule II banks are mainly regional banks or warm. Schedule II banks'

assets and operations are much more concentrated than those of Schedule I banks.

Canadian cities advantage from the presence of banks and insurance firms, which provide the

workforce needed to operate a financial services organization. Largest city of Canada, Toronto,

is a renowned financial center in North America, attracting experienced professionals and world-

class organizations, resulting in a large pool of skilled workers for companies to draw upon.14

There is slight proof that these tax preferences and cuts have had positive economic benefitsbeyond their impact on the finance industry and its shareholders. The Financial Canada Industry

enjoys some tax rates lower G7 countries and has continued to grow rapidly. He now represents

a 70% greater of Canada economy and the stock market than it did 30 years ago. Employment in

finance and insurance has increased at a rate of2.6% per year, but still represents less than 6%

of total private sector employment in Canada. As noted in a recent report the IMF, as result of

tax preferences, "the financial sector may be under-taxed and so maybe 'too big' health of the

economy. Bank for International Settlements also has raised concerns that the growing size of

the financial system industry can increase financial instability.

Costs to the economy and public finances of Canadian recent financial crisis are great and will belong. It is expected that federal and provincial debt will increase by over $300 billion or $9000

per person, on 2008-15 period. Canadian governments have focused almost entirely on cutting

costs and increases in consumption taxes to address these deficits and not considering tax

increases on finance sector.

Canada's banking and financial sector has been the most profitable bank and the extensive

ongoing financial sector continued to record high profits during the recent financial crisis and

economic. Corporations in the finance sector enjoyed a 23% profit margin on average over the

last decade compared with a profit margin averaging 7% for firms in non-financial industry.

Earnings of Canada's banks big five reached $19.4 billion in 2010 and is expected to grow byanother 15% to 20% in 2011.

Canadian economy is clearly taking out of recession with increased 5% in the fourth good point

quarter and heading into this year. Excluding the inventory movements unsold goods, recent

sales were up considerably last quarter, posted a 6.5% increase compared with a very slow pace

14http://investincanada.gc.ca/eng/publications/fin_services.aspx
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of1.9% in the U.S. Despite relative strength in our economy, businesses in Canada, so their

warning, they were willing to increase their spending on machinery, equipment and innovation to

offset the decline in competitiveness resulting from growth of our dollar. A Conference Board

survey shows that U.S. CEOs, however, are safer for the current and expected economic situation

than at any time last five years, although small businesses are less happy.

In recent years, the gap between productivity growths in the Canada wide has hit near record

levels. U.S. productivity growth is surging, a pioneer to future job growth. business sector output

in Canada fell suddenly in a 5.6% annual rate G4, the fastest quarterly gain since its late 1990,

but it will not remove the horrific job in 3 years , which was the first efficiency basically

stagnate. However, she left the production for hours up 1.1% year-over-year, exactly in line with

the average 25-year-old to her.

Reasons for the large disparity between Canada's productivity are not fully understood. Increased

productivity is the most important long-term determinant of living standards (along the terms of

trade and force participation rate). For decades, economists have studied the productivity ofCanadian and governments have corrected the problem, at least in part, many the structural

contributors such as relatively high corporate tax rates, insufficient capital available, reasonably

high interest rates, more regulation and red strip, government subsidies in declining industries,

inter-provincial trade barriers and barriers to foreign investment.

Canada's debt load is the lowest among the G7 and our economy has recovered comparatively

well from the huge depression. Corporate taxes have dropped considerably and are slated to fall

further. However, business sector efficiency growth has declined further over the past decade.

Canadian businesses require re-evaluating the ability of its management practices, especiallywith the development, recruitment and situation. Very few Canadian businesses compared with

their overseas competitors are willing to undertake international research to top talent; this is a

major competitive disadvantage, not only in the C-suite (senior), but below that level as well.

Canadian businesses rely too deeply on generalists. It is important to put experts in roles that

require expertise.15

As well, many large Canadian corporations persevere to move people around for their

professional development. Competitive environment of business today is no place for detains in

leadership roles. They move so often that they never have to live with their mistakes. Every time

someone has moved into a new role, they solve most of what their forebears put in instead, thereduced possible productivity of the team or section.

Canadian Banking and Finance Sector was able to achieve higher profits due partly to its

industrial structure with several large banks and dominant because it is protected by regulations

and also indirect a "big to fail" guarantees from the federal government. Thanks to their tough

15http://translate.google.com.pk/?hl=en&tab=TT
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rule, not Canadian banks failed during the latest financial disaster, but still giving the federal

government $200 billion in a financial safety net to help the Canadian industry, as well as

special loans and financing agreements through the Bank of Canada. This is not an expense

budget, but still comprises an implied financial support to the financial sector and mostly for

large banks.16

CONCLUSION:

In the end we conclude that after discussing all these I can say that Canada has good and

excellent economy. Banking sector has good effect on the economy structure of Canada. Banks

helps the industrial sector by providing the easiest loan facility which effects ultimately

economic growth of the Canada. Therefore, industries boost their production which finally

effects on the economic growth. When production will be increase than the GDP of country is

automatically rise. So, that is good sign for Canada that GDP is increasing due to increase in

production.

16

http://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2011/04/

Fair%20Shares.pdf
http://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2011/04/Fair%20Shares.pdfhttp://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2011/04/Fair%20Shares.pdfhttp://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2011/04/Fair%20Shares.pdfhttp://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2011/04/Fair%20Shares.pdf


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