The C$300bn industrials sector, comprising industries such as transport, construction, engineering and defence, has toppled mining and forestry stocks from their position as the third-most valuable collection of companies on the Canadian market. As the industry struggles domestically and internationally, JP Casey wonders if Canada is turning away from mining.
As recently as 2010, mining was a cornerstone of the Canadian economy, contributing close to a quarter of Canada’s total equity value, according to Bloomberg. While the sector’s total contribution to national GDP has increased from just over C$120bn in 2012 to just over $140bn in 2020, the sector’s relative influence has declined, with mining’s contribution to national equity falling to just 10.8% by January of this year.
This collapse has seen mining and forestry shrink to be the fourth-largest industry in Canada over this period, falling behind the industrials sector for the first time in the last decade, and raising questions about Canadian commitment to mining across the sector.
With geopolitical pressures, domestic tensions between economic and environmental priorities, and the country’s spotty safety record, the Canadian mining industry has been plagued with operational inadequacies, and faces a host of uncertainties heading into the future, both of which have influenced the country’s gradual shift away from what was once a vital sector.
This decline, however, is not for a lack of effort. GlobalData mining analyst David Kurtz noted that, despite this trend, there has actually been a renewed commitment to new mining projects across Canada.
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