An Analysis of the Problems of Prosperity in Canada - Essay Example

? Prosperity Challenges of Canada Introduction Prosperity of nations does not depend on the abundance of the revenue of the nation. The prosperity ofa nation also does not depend upon the strength of the military of the country or the beauty of the public buildings of the nations. Rather the prosperity of the nation depends upon the citizens of a nation; the enlightenment, education and the character of the people of the nation. However, political, economic, demographic, environmental and other tend to have a serious impact on the prosperity of a nation. The country at the focal point of the study happens to be Canada. Canada is one of the most developed and richest countries in the world. The country is blessed rich natural resources and has a diverse and highly educated population. However, the country is going through a phase of change and facing certain challenges on various fronts which could reduce the prosperity of the nation. (Cowan, 2005). Based on in depth research it has been decided that the country faces prosperity challenges in the domain of infrastructure, innovation, demographics, natural resource, government regulation and politics. From an infrastructural point of view it is to be said that the cities of Canada are at the cross roads. The government of Canada does not have any strong agenda on the infrastructural commitments. From the perspective of innovation the prosperity of the country is threatened on three fronts such as the global competition, demographics and productivity. There is very little doubt over the fact that China has a population which is highly educated and skilled. But from a demographic perspective off late the country has been facing a problem of aging population. As mentioned before, Canada has been blessed with rich and large amount of natural resources. Such resources are used for the production of energy which also happens to be a major contributor to the overall GDP of the country. But the growing demand of power has been creating a misbalance in the ecosystem. Also another major problem faced by the country has been the fact the present government regulations are believed to be quite complex and lack robustness. On the political fore front there lie various political complexities especially in the domain of taxations. The present looks to critically analyze all the cause and effects of the challenges mentioned above and looks to propose probable recommendations to over the challenges (Henry, 2008). Cause and effect From the perspective of innovation one of the major challenges faced by the country is the transformation face of the global economy. The global economy is still looking to recover from the after effects of the 2008 recession. Also the economy is going through a transformation phase due to the rise of the emerging economies like china, India, Brazil, etc. This most certainly creates opportunities for the exporters and investors of the country. But the continuous expansion of information and technologies would lead to a high value knowledge network. As a result each and every Canadian enterprise is faced with new levels of intense competition. Just like some of the other developed countries one of the major problems faced by the country is of aging population. The increasing number of proportion of senior citizens would add to the demand of the demand of services in the public domain, especially health care. Also aging the population would mean that there would less number of working and taxpaying Canadians. However, the biggest challenge would come in the form of its effect on the labour market; which would be discussed later (Burgemeister, 2003). Also the innovation of the nation would depend upon the growth of the productivity. However, the recent performance of Canada leaves a lot of scope for improvement. Over the last decade or so the productivity grew by just 0.7 percent. This is far below as compared to other developed countries like USA if the rate of growth in productivity in the near future then the potential economic growth of the nation would likely to get reduced and the prosperity would suffer. Another major challenge faced by the nation is the lack of appropriate infrastructural facilities. As of now the government of Canada does not have any strong urban program. The regional governments seem to be having a traditional approach towards the municipalities. Overall Canada still is quite far away from the scheme of things when it comes to transportation policies. The mayor of Montreal once said that Canada is probably the only G8 member that does not have a formal transportation plan. The cities of the nations are facing immense challenges. Although it has been argued that the lack of infrastructural policies would affect the urban areas only; it has been believed that such problems would fail to bridge the gap between the urban and rural areas leading to degradation in the overall prosperity of the country. Also lack of infrastructure may act as a discouraging factor to those enterprises looking to make invests in the country (Frank, 1964). On the demographic forefront Canada is now being perceived as a young nation growing old. Although there is no doubt over the fact that Canadian population is diverse and quite well educated. However, just like most of the developed countries the Canadian population is growing. It is believed that by 2020 the population of people belonging to the age group of 60 and 60 above may account for third fifth of the total population. The country is presently going through a major demographic shift. However, it’s not just the population that is aging; it is the workforce too. Such talent shortages can be directly linked to the immigration. In the last year Canada was tied with U.K. when it came to the desired destination of work. However, the major obstacle has been the lineup to get into Canada and lack of ability of transform skilled immigrants in to skilled workers (Moschandreas, 2000). Various companies across diverse sectors are already facing the crunch of skilled labors and talents. From an economic perspective also aging population would mean that there would be less number of working professionals and tax payers which may lead to a decline in the economic growth of the nation (Barrow, 1999). (Source: Yssaad, 2012) Canada has an abundance of energy resources which is likely to be more than sufficient to satisfy the needs of the Canadian people. The main reason for the rapid growth of the energy sector has been the development of oil, hydro electric energy sources, oil and natural gas. According to a survey by the national energy board energy production contributes for 5.6 percent of the total GDP. However, there are some courses of concerns. Demand for energy has been increasing round the globe. The present yet to be commercialized and developed energy sources the country has to satisfy the increasing demand. But the extensive combustion of oil and gas could lead to the increase in carbon emission. Also increased amount of use of oil, gas and other resources can lead to scarcity of natural resources leading to a state of ecological disequilibrium. One of the major obstacles in the way o future prosperity in the nation has been the regulatory turbulences. Even, the Canadian Chamber of Commerce feels that the present regulatory process needs to be improved. As of now for most of the projects it takes a lot more time for the projects to get permission. As a matter of fact the lead time can often be as long as ten years or more. One of the main reasons is due to the fact the government looks to run far too many things sequentially rather than simultaneously. For example environmental impact, construction review and the review of facilities design can be run simultaneously. But the government decides to run the processes sequentially increasing confusion, cost and time. On the political forefront one of the major challenges has been the complexities in the present taxation system of the nation. This is mainly because of the fact that the government looks to achieve far too many things simultaneously. For example, the present income tax act looks to incorporate all the features such as fairness, responsiveness, certainty and revenue leading overall complexity. This tends to have a discouraging effect when it comes to the business investment. The political complexities can also be easily linked to the regulatory turbulence, which has been mentioned above. Solutions On the demographic forefront, in order to counter the problem of the aging work force the government may take initiatives by allowing young people to continue higher secondary or post secondary studies along with work. Also the government may consider revamping the four years bachelor program such as three of academic study and one year of full work experience. This would not only help the students to get valuable work experience, but also would mean an early entry into the workforce. Also employment insurance policies should be structures to motivate young beneficiaries to look for jobs actively. A part from this the government has to simplify the process of entry into the country for skilled immigrants; because as now there is too much of complexities are involved (Jones, 2004). In order to counter the infrastructural deficiencies, crucial new round of discussions was help which involved the municipalities, industry and business leaders. In that meeting the federal government of the nation committed to begin brand new long tern infrastructural programs in the course of next few years. The government also needs to eliminate the over regulation and duplication of the businesses. Municipalities also require looking at more private sector partnerships. Also the urban cities of the country have to get a lot smarter. A lot more use of technology has to be introduced in order to predict and ensure sustainable practices of the core operations. The mindsets of some of the local politicians need to be changed. Some of the local politicians have politicians have not shown enough commitment required for upgrades and repairs. All I all the government need to embrace innovations when it comes to the development and designing of infrastructure. This may range from the use of membrane technology to the expansion of sewer capacities to be used to pave the roads. Such initiatives would come in real handy when it comes to increasing the life cycles of the projects and cost cutting. In order to overcome the challenges leading to improvement of prosperity in the Canada it is recommended that the country goes through reforms in the domain of taxation and research & development. Also there is need for the expansion of the pool of the risk capitals. The country needs to adapt to some of the strongest intellectual property regime of the nation. There is also a need to make the bonding between the academic and business a lot stronger. The government may also need to consider launch of new learning and innovation initiatives to spot some of the brightest talents in the country. When it comes to environmental prosperity the government first of all should understand that energy plays a major role in the overall economic development of the country. Keeping this in mind the government should declare consistent and clear environmental performance standards mainly for companies dealing with the production of energy. Also the government needs to encourage the companies to use renewable energy resources for the production of energy in order to avoid increasing emission of carbon foot prints and also to avoid the scarcity of natural resources. When it comes to government policies and regulations the main focus should be on the simplification. Already the chamber of commerce has mentioned that the regulations followed by the government is far too lengthy and leads to complexity. It is suggested that the government may decide to hold a meeting with the industry leaders to understand the problems faced by the investors when regarding government taxation and other regulations. Based on those outcomes the government should take appropriate actions in order to make the regulatory system a lot more robust in order to encourage the investors. Conclusion The demographic, economic, environmental and political factors tend to play a major role in the overall prosperity of a country. Although Canada is blessed with various rich natural resources the country faces major challenges towards the achievement of the future prosperity on various fronts such as the infrastructure, innovation, demographics, natural resource, government regulation and politics. Canada is probably the only member of the G8 nations not to have an urban infrastructural agenda. Also the country faces major threats in the domain of innovation due to the global economic transformations and shifts in demographics. Like other developed nations Canada also faces the problem of aging population. As a result the county is most likely to face major economic slow-down along with crunch of skilled labors in the labor market. Also the increasing amount of demand for energy the country may have to encounter a situation of scarcity of natural resources and increase in the carbon emissions leading to an ecological misbalance. Also it is believed that the overall government regulations lack robustness and are believed to be far more complex. Therefore it is suggested that the government takes the help of technology and involves the local communities and also eh political leaders to improve infrastructure; make reform in the higher education system along with the immigration policies to combat the issue of aging population; sets out clear energy policies along with encouragements to motivate the companies to use the renewable energy resources; and at last but not the least based on the feedbacks of the industry leaders and business men the government should look to make changes in the present government regulation to eliminate operational bottle necks (Sekran & Bougie, 2009). References Barrow, C. (1999). Environmental Management: Principles and Practices.US: Routledge. Burgemeister, S. (2003). Market analysis. DE: GRIN Verlag. Cowan, A. (2005). Risk Analysis and Evaluation. UK: Global Professional Publishing. Frank, N. (1964). Market analysis: a handbook of current data sources. US: Scarecrow Press. Henry, A. (2008). Understanding Strategic Management. UK: Oxford University Press. Jones, T. (2004). Business Economics and Managerial Decision Making. UK: John Wiley & Sons. Moschandreas, M. (2000). Business Economics. UK: Cengage Learning. Sekaran, U. and Bougie, R. (2009). Research Methods for Business: a skill building approach, 5th ed. New Jersey: John Wiley & Sons. Yssaad, L. (2012). The Canadian Immigrant Labour Market. Canada: Statistic Canada. Read More