The Canadian economy has become much more

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The Canadian economy has become much more
outward oriented...
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...largely as a result of closer linkages with
the U.S. in trade...
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direct investment
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Increased Canada-U.S. trade linkages are
pervasive across all provinces...
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Canadas trade links with Mexico are still not
very strong but have increased considerably
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More than 80 percent of Canadas manufacturing
output growth in the 1990s can be attributed to
exports
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The FTA raised manufacturing productivity
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Foreign-controlled firms on average are more
productive than Canadian controlled firms
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Competition from Mexico and China in the U.S.
market is rising
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The booming U.S. economy was the main driver of
our export success in the 1990s
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The depreciation of the Canadian dollar was
another reason for the expansion of exports
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Canada needs to address the productivity challenge
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We need to maximize the full benefits of Canada-
U.S. economic linkages

• North American economic linkages on balance have
  been beneficial for Canada.
• But, to fully realize the benefits of increased
  Canada-U.S. economic linkages, Canada needs to
• reduce border risks and impediments
• facilitate the efficient operation of markets
• encourage private sector entrepreneurship and
  dynamisms
• attract and retain highly qualified people and
  investment in key sectors of the knowledge
  economy and
• improve Canadas innovation and productivity
  performance.

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