According to a recent National Bank Financial ETF Strategy report, Canadian equity ETFs experienced more than $1.5 billion of outflows in 2015. This trend is expected to continue over the remainder of the year, especially as U.S. equities rebound back to new highs. It’s hard to blame investors for exiting Canada given all the uncertainty facing its economy, but things are about to change and here are five reasons investors should look to stay at home.
1. Potential fiscal stimulus
Canadians are worried about the economy and desire additional fiscal stimulus, which generally boosts equity markets in the process.
2. Impact of a falling loonie
The Canadian dollar has dropped in value by 27.5 per cent from its 2011 high and hit its lowest level since 2004 when measured against the U.S. dollar.
Since most of this drop has occurred since July 2014, the impact hasn’t yet shown up in our economic numbers. It soon will. That should provide a boost to corporate earnings and trade flow.
3. Long bear commodity cycle nearing its end
After slowly working through a massive surplus of inventory caused by seven years of overcapitalization at the start of the millennium, there are signs that we are approaching the bottom of the ongoing bear commodity cycle.
There has been a lot of deal flow lately in the Canadian oil and gas sector — including a hostile offer, plenty of asset sales and a couple of friendly deals — which is a positive sign that the sector is getting cleaned up.
4. Strong housing market
The Canadian housing market continues to defy gravity, surprising all of those trying to bet against it., keeping consumers feeling confident.
5. Attractive valuation
Finally, from a valuation standpoint, the S&P/TSX composite is trading at a full 10-per-cent discount at 14.8 times forward earnings compared to the S&P 500 at 16.5 times.
There is room for this multiple discount to narrow once investors get comfortable with the forward outlook from corporate earnings, which are about to show the benefits of the falling Canadian dollar.
Canada’s recent federal election results prove that most Canadians reject the divisive policies of the conservatives, the former governing party, for its xenophobic policies. Canada was the first country in the world to introduce the 1971 Multiculturalism Policy.
Although the backlash against multiculturalism has been less influential in Canada than in other European countries, it has not been altogether absent. It is most evident in Quebec, where the debate about “reasonable accommodation” and the Quebec Charter of Values is long-standing – fuelled by a suspicion that multiculturalism has always been a tool to undermine Quebec’s distinct status.
According to an opinion poll commissioned last spring by the Privy Council Office, a significant majority of people surveyed across the country supported the requirement “that people show their face during Canadian citizenship ceremonies”. Stephen Harper immediately seized this as a wedge issue and took a hard stand against the niqab. He asserted that his government, if re-elected, would consider banning public servants from wearing the facial covering and similar types of clothing.
However, as other political party leaders made clear, many dislike niqabs. But if a Muslim woman freely chooses to wear one, it is no one’s business. Multiculturalism is more than just a demographic reality. It is an important approach to ensure social integration. It recognizes that sometimes treating people as moral equals means allowing them to be different.
Refugee advocates continue to question Justin Trudeau’s pledge to admit 25,000 Syrian refugees to Canada before New Year’s Day. Yet, Liberal MP John McCallum says his incoming government is committed to delivering on its election pledge.
McCallum noted that even with security checks, resettling 25,000 people in 8 weeks are a question of “political drive.”
Chris Friesen, president of the Canadian Immigrant Settlement Sector Alliance, says it is unlikely to properly support so many families on such a short timeline. While he believes it is possible to bring in 25,000 refugees over several weeks, it would impose significant challenges that would affect the settlement outcomes of these refugees.
The process of relocating 25,000 is one thing. The bigger challenge is once they arrive, how to successfully integrate them into Canadian society.
In September, Ontario announced that it would set aside $8.5 million to help resettle 10,000 refugees in the province by the end of 2016. Ontario’s Immigration Minister Michael Chan has voiced concerns on the feasibility of this commitment for Ontario.
Nova Scotia Immigration Minister Lena Diab said preparations are being made to welcome its allocation of refugees in that province. Quebec Immigration Minister Kathleen Weil said her province will receive 3,650 refugees this year and the same number in 2016 for a total of 7,300 Syrian refugees by the end of 2016.
Friesen said officials have informed his group that Canada is currently on track to meet the Harper government’s commitment of having 11,300 Syrian refugees arrive in Canada by Sept. 2016, and that a new processing center in Beirut is currently processing about 700 cases a week.
Controversial restrictions imposed by the conservatives are under attack. The rules prevent a spouse or partner from abroad who has been in a relationship with a Canadian sponsor for two years or less from becoming a permanent resident, immediately following their arrival to Canada. The policies require the newcomer to remain in a relationship with their sponsor for two more years following arrival or risk facing deportation.
The Canadian Council for Refugees says a consultation with dozens of immigration organizations confirms the rules has increased the vulnerability of many newcomers, most of them women. The refugee advocacy group is urging the federal Liberals to repeal this provision that in effect, forces women to remain in abusive relationships as a condition to become a Canadian permanent resident.
Yet there is an exception specifically for victims of abuse. The refugee council says that government bureaucracy, language barriers and the burden of proving mistreatment is preventing the exemption consideration from working.
The council contacted over 140 settlement organizations, legal clinics and women’s shelters and found that a lack of information about the conditional residence provision was a significant challenge, especially in areas outside major urban centres.
The Liberals have committed to repealing conditional permanent residence. Citizenship and Immigration spokeswoman Nancy Caron said the government is sensitive to the issue of family violence and will study the issues raised by the council.
According to the council, organizations that tried to make use of the exception provision for victims have experienced several issues. These include:
- Not all Citizenship and Immigration Canada representatives understand the rules of the conditional sponsorship rules and often provide misleading information;
- There is an apparent lack of training on spousal violence on the part of immigration officers conducting interviews who decide whether an exception should be granted;
- Compiling evidence was difficult to obtain as was proving emotional or psychological abuse;
- Officials did not always respond promptly to requests for an exception
Canada’s election of a Liberal government, under Justin Trudeau, has big implications from the perspective in the United States. Of all the neoliberal parties during the Clinton-Blair 1990s, the Liberal Party of Canada qualified as the neo-liberalist. Under the double-headed leadership of Prime Minister Jean Chretien and Finance Minister Paul Martin, the Liberal government of 1993 cut federal spending to its lowest levels since the early 1950s. It sharply cut the top rate of corporate taxes, and hiked contributions to the federal pension plan. It reneged on a promise to repeal a consumption tax on goods and services introduced by its Conservative predecessor. Canada attained a balanced budget in 1998 and recovered its triple-A bond rating in 2002.
That Liberal Party lost power in 2006 and in 2011, it finished third behind the socialist New Democratic Party (NDP). The party then turned to Justin Trudeau in 2013 to resurrect its fortunes. The young leader in turn made a desperate gamble of his own: to steer his centrist party hard left, mobilizing resentments and outflanking the NDP.
Trudeau bears the most famous name in Canadian politics. His father, Pierre Trudeau, dominated Canadian politics from 1968 to 1984. Pierre Trudeau plunged Canada into ultra-statist experiments and massive debts. He resigned in 1984, just months before voters handed the Liberals its worst defeat in the party’s history up until that time.
Meanwhile, Justin Trudeau has styled himself as approachable where his father was aloof. He was conspicuously absent from press briefings on his economic policy, explaining that he was vanishing from the campaign trail a month before election day to spend “quality time” with his family.
Justin Trudeau has made it clear that the government he will lead will repudiate the legacy not only of the incumbent Conservative prime minister, Stephen Harper, but the neoliberal Liberals of the 1990s.
Trudeau has committed himself to a policy of deliberate deficits, in the short term, to stimulate growth. His campaign focused on increasing taxes on wealthier Canadians to a new top rate above 50 percent while also vowing to cancel the Harper government’s controversial F-35 jet contract, insisting that Canada does not need such an advanced fighter plane. He pledged full legalization of marijuana and promised to increase Canada’s intake of Syrian refugees from 10,000 by next year to 25,000 annually effective immediately.
In Trudeau’s most memorable speech that he gave in his pre-prime ministership, he characterized the demand of some Muslim women to cover their faces during Canadian citizenship ceremonies as the moral equivalent of the doomed voyage of German Jewish refugees on the St. Louis in 1939.
The immediate aftermath of Trudeau’s success has been the downturn in the Canadian economy following the collapse of the price of oil and other commodities. Despite suffering comparatively less than other advanced economies from the made-in-USA financial crisis of 2008, Canada has suffered more than most from the sharp slowdown of the Chinese economy that began in 2014. Over the last 24 months the Canadian dollar has lost almost 20 percent of its value against the U.S. dollar and while that depreciation will in time stimulate Canadian exports, its immediate effect is to cut deep into purchasing power in a heavily trade-dependent economy.
Trudeau’s overall strategy succeeded brilliantly with the Liberals winning at least 40 percent of the popular vote, their best performance since 1997. Pundits now raise the next question: can he deliver on his election promises and keep Canada on a strong path in the future?
The Quebec government has revealed important details under its popular skilled worker immigration program that is set to reopen on November 4, 2015. It plans to receive 6300 new applications during the 2015-2016 period. The Quebec program features more than 75 eligible occupations and areas of training that will enable applicants to qualify for a Quebec Certificate of Selection (CSQ), without a job offer.
Ability to communicate in the french language is often not required.
The period of reception for applications under the Quebec skilled worker program will operate under two systems.
November 4 – December 15, 2015:
Maximum 3500 applications will be accepted by Post.
January 18 – March 31, 2016:
Maximum 2800 applications will be accepted via the internet.
Unlike the federal Express Entry immigration system or programs offered by other provinces under Provincial Nominee Programs (PNP), Quebec remains the only program in Canada where skilled worker applicants can predict their chances for admission on the basis of their proven qualifications. Applicants, who reach a passing score under the Quebec system, receive a CSQ which enables them to qualify for Canadian permanent residence.
A Quebec skilled worker is foreign national who intends to settle in Quebec to hold employment the foreign national is likely able to hold. This determination is made using a point system which evaluates the candidate’s area of training, education, experience, age, language, qualifications of a partner or spouse, offer of employment (which is not required), children and adaptability.
Applicants in a wide range of areas including Management and Financial Services, Engineering and Information Technology and Health Care, have the best chances to succeed under the Quebec Skilled Worker program.
The Quebec application selection process follows a multi-stage assessment process each with minimum cut-off scores. Applicants with a passing score are issued a Quebec Certificate of Selection and may apply to the federal authorities for entry to Canada. Once admitted a permanent resident enjoys all the rights and freedoms of labour mobility throughout Canada provided under the Canadian Charter.
Quebec has received worldwide attention as a popular immigration destination. Recently, the City of Montreal was rated by the Economist magazine, second to Toronto, as the best place in the world to live.
“Montreal is a vibrant metropolis and continues to offer outstanding economic opportunities and quality of life”, says Attorney Colin Singer, Managing Partner of www.immigration.ca and Global Recruiters of Montreal (www.grnmontreal.com).
“For those who are interested in relocating to Canada, the Quebec program offers distinct advantages. First, it manages the largest immigration program among all the provinces in Canada. Second, it does not permit the Minister to actively pick and choose the applicants it wants. This provides applicants to Quebec with more predictability of outcome over the federal Express Entry system and other provincial immigration programs” says Attorney Singer.
Overall, Quebec plans to receive approximately 50,000 immigrants in 2016, under all classes, including nearly 30,000 skilled workers. This is consistent with the immigration levels in 2015.
If previous indicators are a valid measure, Quebec’s quota of 6300 under the skilled worker program will likely fill quickly. However applicants with a valid job offer, previous work experience in Quebec or having completed a valid period of study in Quebec may also qualify under the Quebec Experience Class and would not be subject to the skilled worker program quota.
Find out whether you qualify to Canada by completing our free on-line evaluation. We will provide you with your evaluation results within 1-2 business days.
The federal government will soon be expanding its planned border exit-tracking system to avoid paying hundreds of millions of dollars in social benefits to vacationing Canadians who have long absences from Canada.
In conjunction with United States authorities, the expanded program will enable Canada Revenue Agency and Employment and Social Development Canada to save between about $194 million and $319 million over five years.
Savings can be expected through “preventing abuse and eligibility fraud” with respect to the employment insurance, old age security and child tax benefit programs by ensuring Canadian residency requirements are fulfilled.
It estimates savings over five years of the following amounts:
- $48 million by Employment and Social Development Canada for the old age security program;
- $21 million by Employment and Social Development Canada for the employment insurance program;
- $125 million to $250 million by the Canada Revenue Agency for the child tax benefit program.
Under the 2011 perimeter security pact, Canada and the United States agreed to set up co-ordinated monitoring systems to track entry and exit information from travellers. Currently, the tracking system involves exchanging entry information collected from people at the land border — so that data on entry to one country serves as a record of exit from the other.
The first two phases of the program have been limited to foreign nationals and permanent residents of Canada and the United States, but not citizens of either country. Even though no revised dates have been announced, federal officials have said work continues on the final phases.
It has long been known that information from the entry-exit initiative would also be used to track the movement of suspected fugitives, child sex offenders, smugglers and terrorists, as well as identify people who remain in Canada past visa-expiration dates and help determine when those slated for deportation have voluntarily left.
However, the internal documents describe several measures to protect privacy including signs at the border to notify travellers their information may be used for program integrity. People flying into Canada have been warned for many years that information on their customs declaration card may be shared. Legislation to implement the final phases of the entry-exit initiative will reveal exactly how the information may be used and disclosed.
OAS benefits are calculated based on years of residence in Canada. After 40 years of residence after age 18, Canadians over age 65 are entitled to the maximum government pension.
OAS benefits are not reduced merely for spending too long outside Canada. It is common in fact for Canadian authorities to deposit benefit payments directly into the accounts of snowbirds who spend long periods of time outside Canada. The risk is for residents who do not acquire the requisite 40-year minimum after age 18 and do not disclose this on their application.
Health coverage benefits and income tax rules pose a bigger risk for Canadians who spend significant amounts of time outside Canada. Generally, Canadians who spend more than 183 days each year could be affected by Canadian and foreign legislation.
Despite the Canadian economy adding 12,000 jobs in September, the unemployment rate climbed to 7.1%, its highest level since February 2014 as more people entering the labour force. The September jobs report was the last major piece of economic data before the federal election held on Oct. 19.
According to Statistics Canada, the number of Canadians working in the education sector increased marginally. This resulted in a drop in the seasonally adjusted result.
Increased part-time work added 74,000 jobs, while full-time employment fell by 62,000. The Bank of Canada has cut its key interest rate twice this year in an effort to help the economy which contracted in the first half of the year mostly due to the drop in oil prices.
The central bank says future indicators of business activity have improved, supported by a generally positive outlook for the U.S. economy and a weaker Canadian dollar. However, persistent weakness in commodity prices are continuing to have an effect on the economy, dampening the outlook for firms tied to the resource sector.
The September, the labour force survey confirmed the number of self-employed increased by 31,000, while public sector employment fell 29,000. The number of private sector employees climbed by 10,000.
A newly released report produced by International Organization for Migration (IOM) provides a global overview of people’s attitudes towards immigration. The full findings of the report were presented at the Global Forum on Migration and Development (GFMD) Summit in Istanbul, Turkey.
“Monitoring public attitudes towards immigration and understanding what shapes such attitudes are essential to identify how to combat anti-migrant sentiment – which is one of the key recommendations of the 2013 High-Level Dialogue on Migration and Development.
People were asked two questions about immigration: In your view, should immigration in this country be kept at its present level, increased or decreased? Do you think immigrants mostly take jobs that citizens in this country do not want or jobs that citizens in this country want?
The study, based on interviews conducted by Gallup with over 183,000 adults across over 140 countries between 2012 and 2014, shows that people around the world are not as opposed to immigration as may be commonly assumed.
Approximately 43 per cent favour increasing or keeping stable the numbers of immigrants in their countries, while only 34 per cent support lower levels of immigration.
Residents in the Americas generally showed more positive attitudes towards immigration. Australia and New Zealand were mostly positive towards immigration. The same was true for the Gulf Cooperation Council countries, where temporary migrant workers represent the highest percentage the total population worldwide.
People in Europe appeared to be the most negative towards immigration, with over half of all respondents favoring lower immigration levels in their countries.
Attitudes differed substantially between Northern Europe – with people in Sweden, Denmark and Finland being generally positive about immigration – and Southern Europe, where a high percentage of people in Greece, Malta and Italy wanted to see immigration reduced.
Interestingly, adults with tertiary education are more likely to favor increasing immigration levels than people with lower levels of education. Younger age is also generally associated with more positive attitudes towards newcomers.
People who believe their personal or country’s economic situation are worsening, are more likely to favor lower immigration levels in their countries, and vice versa.
Since public opinion on migration plays an important role in the design and effectiveness of integration policies in most countries, it is important to regularly monitor it to make sure policies can achieve their intended results
During the past 25 years, Canada’s population has grown by more than 25 per cent. Yet during the same period, Nova Scotia’s population increased by a mere three per cent.
Experts believe the modest growth combined with an aging population could lead to economic disaster for the province. The solution in the immediate term is an increasing immigration rate to Nova Scotia.
But the federal government controls immigration and puts a cap on how many immigrants can go to which province and when.
Last month, the Nova Scotia government said it would create two immigrant streams to attract newcomers — one as entrepreneurs and one for International University students to remain and work in the province.
Ottawa recently agreed to allow Nova Scotia another 300 immigrants to fast track under the federal government’s express entry streams.
Despite this positive development, Nova Scotia still needs three times these numbers of immigrants it currently receives in order to significantly increase its population levels.