The economies of Canada and the United States are similar because both are developed countries. While both countries feature in the top ten economies in the world in 2022, the U.S. is the largest economy in the world, with US$24.8 trillion, with Canada ranking ninth at US$2.2 trillion.
Overview
This article compares the economies of Canada and the United States based on GDP, debt-to-GDP ratio, inflation, unemployment, public debt, taxation, and purchasing power parity.
In 2023 the population of Canada was 39,566,248 (Q1, 2023) compared to 36,991,981 in 2021 while the population of the United States was 333,287,557 in 2022, almost nine times larger than Canada.
The United States GDP was $24.8 trillion in 2021. The United States has the largest economy globally and Canada ranks 9th at US$2.015 trillion.
The US share of the global market economy estimated at US$79.98 trillion, was c. 25% in 2018, which is down from 35% in 2005. China's global e-commerce market share has grown rapidly from less than 1% in c. 1998 to 42% in 2018. China now has second largest economy in the world with a value of US$14 trillion.
Canada's 2017 debt-to-GDP ratio was 89.7%, compared to the United States at 107.8%.
According to the IMF's 2018 annual Article IV Mission to Canada, compared to all the G7 countries, including the United States, Canada's "total government net debt-to-GDP ratio", is the lowest. Canada has been the G7 leader in economic growth since 2016. The unemployment rate in Canada is at its lowest level since c.1978. Over 600,000 full-time jobs have been created in Canada since early 2016.
The IMF's 2018 annual Article IV Mission to the United States reported that, "Unemployment is low, inflation is well contained, and growth is set to accelerate. During the course of this administration, the economy is expected to enter the longest expansion in recorded U.S. history." Topics covered include competition, debt, sustainability analysis, economic indicators, fiscal policy, fiscal sustainability, monetary policy, tax policy and trade policy.
The International Monetary Fund's annual World Economic Outlook provides the main economic indicators in Canada in selected years between 1980 and 2017. Inflation under 2% is in green.
In 2016 the GDP per capita in Canada was compared to in the US.
This table show the same economic indicators in the United States in selected years between 1980 and 2017. Inflation under 2% is in green.
International trade
Canada and the United States are member states of international trade organizations, including NAFTA—replaced by the United States–Mexico–Canada Agreement (USMCA) negotiated in 2018, G7, G20, OECD and WTO.
According to a Global Affairs Canada 2018 report, Canada's exports increased 5.7% to a record high in 2017 of $CAD546.7 billion—$29.2 billion above the exports level in 2016. In 2017 imports also rose to an all-time high of $CAD1,108 billion. In 2017, Canada's exports increased to Japan, India, South Korea, Germany, the United Kingdom, and China. In September 2017, the Comprehensive Economic and Trade Agreement (CETA) came into force. In March 2018, Canada signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). In October 2018, Canada, Mexico and the United States negotiated the United States–Mexico–Canada Agreement (USMCA) to replace NAFTA. In October 2017, Canada began new free trade negotiations with the Pacific Alliance Latin America trade bloc—formed by Chile, Colombia, Mexico and Peru, and in March 2018 with the Mercosur South American member countries.
According to Statscan, Canada's trade deficit shrank to CAN$416 million (US$318 million) in September 2018.
According to the August 2018 International Trade Compliance (ITC) report, in 2017, US merchandise exports increased $95.7 billion or 6.6% from $1,451.0 billion in 2016 to $1,546.7 billion. During the same period, US imports increased by $155.1 billion or 7.1% up from $2,187.8 billion in 2016. In 2017 energy-related products represented the largest increase in both imports and exports in the US.