Conference Board Of Canad Political And Regulatory Environment

6. PEST

Political and Regulatory Environment

Canadian government size is relatively smaller, comparing with other country such as China or Russia. The relatively small government size enables high economic freedom. The top federal personal income tax rate remains 29 percent, and the top corporate tax rate has been cut to 15 percent. 2016 economic freedom score is 78.0, ranking at 6th globally (The Heritage Foundation, 2016). It is a good sign for foreign companies to enter into Canadian market by establishing new branches or cooperating with existing companies in Canada. The economic freedom is above world average and region average, however, the score is declining in the recent two years (see Figure 1). It may imply that the market would

In 2015, the GDP was $1.6 trillion, with 2.5% growth. GDP per capita was $44,843. Unemployment was 6.9%. Inflation (CPI) was 1.9%. FDI inflow was $53.9 billion. In 2016, the USD to CAD ratio is 1:1.36. However, in November 2016, the Conference Board of Canada says its consumer confidence index in October posted its largest drop since the price of oil first dropped below US$30 a barrel in January. The survey found that, relative to September, more respondents said their household finances were worse than they were six months ago and expectations also went down about future financial

Transportation costs are significant and have kept some merchants from getting into Canadian e-commerce market. However, increasing number of Canadian and U.S.-based retailers are taking on the challenge, establishing and investing in their e-commerce capabilities in the country. U.S.-based retailers including Amazon.com Inc., Best Buy Co. Inc. and Wal-Mart Stores Inc. BMO Capital Markets, in a research note that estimated Canadian web sales of retailers, ranked Amazon.com Inc. as the No. 1 e-retailer, and Amazon.ca (Amazon’s site for Canadian consumers) as the