5 minute read - Published 15:25 EST, Tuesday December 11
This article was authored by Peyton Baird of witan nook.
Canada is at a crossroads, both politically and economically. Inflation is real and is affecting wallets, home buying is nearly impossible for new families, grocery prices are soaring, and the emigration of young, educated Canadians has reached concerning levels. In addition, while we have the world's fifth largest oil reserves, we pay a hefty price at the pump and are importing nearly 500,000 barrels per day, 17% of which come from Saudi Arabia. While these challenges are daunting, a solution lies in one of Canada’s historical strengths: natural resources. Lumber, oil and gas, and metals and minerals can be the cornerstone of an economic revival, provided extraction is done sustainably. This approach has the potential to address immediate economic woes and lay the foundation for long-term prosperity through advanced technology manufacturing.
Real per Capita GDP Growth for G7 Countries (Last 10 Years) | NBF, OECD, Bloomberg
Current Economic Challenges
Canada’s inflation reached its highest in four decades in 2022, peaking at 8.1%. While it has moderated slightly, essential costs like food and housing remain a major burden. Nearly half of Canadians struggle with rent or mortgage payments, and many cannot afford unexpected expenses. At the same time, wages have failed to keep pace, leaving families and individuals stretched thin. Compounding this is the outflow of skilled workers—Canada’s young professionals are seeking better opportunities abroad due to higher living costs and limited economic opportunity.
The Opportunity in Natural Resources
Canada is a global leader in resource availability and operates within a framework of stringent environmental regulations and a significant societal focus on environmental sustainability. If the world needs more natural resources, why not have it be Canada that provides them, benefits economically, and causes less environmental damage than its competitors? Its vast reserves of minerals, oil, and timber are not just commodities; they are a pathway to economic growth and innovation. By focusing on sustainable extraction, Canada can simultaneously spur domestic production, create jobs, and position itself as a global supplier of responsibly sourced materials. This is critical at a time when global markets are increasingly demanding sustainable supply chains for technologies like electric vehicles, renewable energy systems, and advanced construction materials. With the world demanding these renewable energy technologies but opposing new resource extraction, we will never experience the ‘green revolution’ that is expected. More metals and minerals are needed to fuel the revolution, and Canada is perfectly positioned to be one of the core suppliers.
Canadian Mined Minerals by Value of Production in 2022 | Natural Resources Canada
Benefits of Sustainable Resource Development
Economic Activity and Employment: Resource extraction is labour-intensive, involving mining, forestry, and oil operations, as well as secondary services like logistics and processing. These activities create well-paying jobs and stimulate local economies, particularly in rural and Indigenous communities, where employment opportunities are often limited.
Increased Tax Revenue: Governments stand to gain from the taxes and royalties generated by resource industries. These funds can be reinvested into innovation, such as green energy projects, education, and infrastructure, creating a virtuous economic cycle that can incentivize Canada’s educated youth to stay in the Country.
Strengthening Domestic Industries: Having a reliable domestic supply of raw materials can lead to the growth of advanced manufacturing sectors. For instance, critical minerals like copper, nickel and cobalt, are essential for battery production in electric vehicles. By fostering these industries, Canada can reduce reliance on imports and support the global energy transition through the retail of these raw materials, and also the ability to grow the domestic manufacturing industry.
Before (a) and After (b), of a Land Remediation Plan | Nature.com
Addressing Environmental Concerns
Critics of resource extraction often highlight, rightly, its environmental risks, but modern techniques and technologies mitigate many of these concerns. In addition, companies that adhere to their land remediation plans are the ones that should receive government subsidies or capital investment, as the remediation stage is where many critics, rightly again, point their finger at bad actors. For example, mining is destructive during its operating mine life, however, when the metals and minerals are extracted, a properly executed land remediation plan can leave the area fit for nature's takeover, albeit terraformed, with the possibility of a new lake emerging. In terms of modern technologies that mitigate many existing environmental concerns, advanced monitoring systems reduce environmental degradation, and Canada’s regulatory framework is among the strictest globally, ensuring that operations meet high environmental and social standards.
Investing in sustainable resource extraction practices not only protects ecosystems in the longer term but also bolsters Canada’s reputation as a leader in responsible resource management, setting an attractive precedent for other nationals to follow. Canada is, and will continue to be, the global leader in these environmental regulations, however, they can not come at the outright hindrance of necessary extractive operations. The perfect balance will attract international investment and partnerships, further strengthening the economy and Canada’s global reputation.
Conclusion: A Path to Prosperity
The sustainable extraction of natural resources is not a step backward; it is a step toward a future where Canada maximizes its natural advantages responsibly and invents, produces, and sells, the most efficient technology in the world. By leveraging its resource wealth, Canada can address current economic challenges, create high-quality jobs, and establish itself as a leader in the global push for sustainable development.
While there are no quick fixes to the country’s economic challenges, embracing sustainable resource development is a pragmatic and powerful strategy. It offers a way to capitalize on Canada’s strengths while addressing the pressing need for economic growth and innovation. If executed wisely, this approach can ensure that future generations inherit not only a stable economy but also a sustainable and prosperous nation.
This article was authored by Peyton Baird of witan nook.
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