Canada's growth can remain resilient even if some industries are negatively impacted by trade tensions with the United States, Macquarie Bank said in a note.
Canadian Prime Minister Mark Carney will host the Canada Investment Summit in Toronto Sept. 14-15, in what the government has called the first-of-its-kind gathering in the country. It comes after the US imposed tariffs on Canada, which were met by Canadian counter-tariffs.
Trade diversification is already underway, Macquarie said.
Over the past 18 months export growth to the rest of the world outperformed, wrote Macquarie economists David Doyle and Chinara Azizova in a recent note. Canada's premiers are also making progress on reducing inter-provincial trade barriers, with the IMF calculating that doing so could boost Canada's real gross domestic product per worker by nearly 7%.
Employment gains have also been solid and housing-related activity and prices are stabilizing, they added.
Canada also retains several advantages, including a AAA credit rating, low government debt as a share of GDP, and low federal deficit as share of GDP. The Federal government also enjoys strong public support.
Apart from streamlining critical minerals and energy projects to boost growth, the economists noted the rise of data center investments, already an important growth driver in the US.
"There is growing evidence that the same drivers are emerging in Canada and could be set to propel growth ahead," the economists added, noting that Alberta currently accounts for 92% of planned data centre capacity.
They pointed out that in Canada there was a 59% month-on-month surge in June for imports of computers and computer peripherals. The increase was driven by imports of processing units (of the type used in data centers) coming from the US.