Ontario

Province Dept: The reasons are simple. Beginning in 2003, the Canadian dollar began a strong ascent that lifted it from the persistent lows of the previous decade around 70 US cents to the recent highs around parity with the U.S. dollar during the past four years, with only a brief dip in late 2008 and early 2009. This surge in the currency made Ontario s exports more expensive for foreigners to buy and rendered the province s exporters less competitive, while also making imports cheaper, according to The Star. Ontario s overall GDP per head relative to the rest of the country reflects the turnaround in trade. In 1998 2002, Ontario s GDP per person was 14.1 per cent higher than the average for the other nine provinces and three territories; in the first three quarters of 2011, it was 6.5 per cent lower. Since 2006, Ontario s GDP per person has been below the average for the rest of Canada and the roots of Ontario s current fix lie in both the economy and in the province s record of failing to keep growth in government spending in line with revenue growth. Ontarians have long been accustomed to their economy growing faster than the rest of the country. This was once true: in 15 of the 21 years from 1982 to 2002, Ontario grew faster than the national economy. But changing economic conditions have hit Ontario harder than other provinces over the past decade; in all nine years from 2003 to 2011, Ontario s real economic growth was below that of the rest of the country. The impact on Ontario s nominal GDP was huge. The contribution of trade to the economy is measured by net exports, the difference between what the province sells outside its boundaries and what it buys from other countries and provinces. Ontario s net exports to other provinces, where there was no currency effect, remained relatively stable. But the contribution to GDP of net exports to other countries first vanished entirely and then began to detract from Ontario s growth. The financial crisis and resulting U.S. recession, during which auto sales fell by about one-third, aggravated this trend. The province s international trade surplus, which accounted for 4.3 per cent of GDP in the 1998 2002 period, disappeared by the middle of 2006 and was replaced by a trade deficit, which in the first three quarters of 2011 diminished nominal GDP by 7.5 per cent. (www.immigrantscanada.com). As reported in the news.