Canada Eyes Investment Supercycle for Economic Growth
The Canadian government is working to kick-start an investment supercycle in the country, which could lead to sustained growth and improved living standards. According to TD Economics, a multi-year period of elevated investment would feed through to Canada's economy broadly, setting the stage for higher productivity, incomes, and government revenue.
The government plans to catalyze investment in priority areas such as energy, resources, transportation infrastructure, AI, and defense. These sectors are capital-intensive, labor-intensive, and have long-duration projects that would create a self-reinforcing feedback loop.
A high-investment scenario could see real GDP growth accelerate to 2-2.5% annually, compared to the current baseline forecast of 1%. This would also lead to an increase in living standards, with average output per Canadian rising by around $12,000 by 2035.