Canada and Brazil have both been having a tough time when it comes to their relative global economic performance. Canada and Brazil have both seen a decline in their share of
world output over the last thirty years.
In 1980, Brazil’s economy accounted for 4 percent of world GDP while
Canada accounted for 2.5 percent. By 2013, Canada’s share had declined to 1.8
percent while Brazil’s had declined to 2.8 percent. Given their common economic strengths in the areas of
aircraft manufacturing, forestry, and mining they should each be keenly
interested in what the other’s industries are doing. They are after all both competing for world export
share. In Canada’s case, Brazil is
also a top destination for new export opportunities, which again would make
them a focus of our interest.
Of course, the recent economic espionage caper involving Canada could have unfortunate consequences in this regard.
If Canada is seeking economic intelligence about Brazil, it should focus on the following. While both countries have seen a decline in their world
share of economic activity since 1980, Brazil has stabilized since 2000 while
Canada has continued to decline. What
is Brazil doing that we are not? Based
on Macklem’s analysis: 1) they could be trading with countries that are growing
faster than the global economy 2) they could have faster productivity growth 3) they
could have a product mix that is more closely matched to world demand. Naturally, if
they are more effective competitors, it should ultimately be reflected in their
per capita GDP growth. While our
per capita GDP in US PPP dollars is still much higher than Brazil’s, since 2000,
Brazil’s has grown 74% while ours has grown 46%. In this regard, they have been doing better over the last decade.