2018-2019 Operating context: conditions affecting our work
Canada's territories are home to approximately 114,000 people, half of whom are Indigenous, living across over 40% of Canada's landmass. The territorial Indigenous governance landscape is composed of settled land claims, self-governing Indigenous organizations and some unsettled land claims.
Economic development and growth throughout the territories is challenging due to a sparse and widely distributed population, dependence on natural resource extraction subject to commodity pricing, a significant infrastructure deficit, high energy costs and a shortage of skilled labour. These challenges inform CanNor's activities and operations, and impact how it delivers on its mandate.
The North's natural resources will continue to be a strong foundation for economic growth and sustainability. According to the Conference Board of Canada's latest Territorial Outlook, although the Gross Domestic Product (GDP) is forecasted to decline in all three territories in 2018: Nunavut at -0.5%, NWT at -1.1% and Yukon at -3.1%, the long term picture is more positive. To complement expected growth of resource development in the medium- and long-term, sustainable northern economies will continue to require a focus on investments that contribute to economic diversification and innovation.
Canada's territories have a significant infrastructure deficit that makes it difficult to get goods to market and increases costs of doing business. A lack of affordable and reliable connectivity when compared to southern Canada challenges Northerners access to the knowledge economy as well as to attract and retain skilled labour. With nearly 70% of northern communities relying on aging diesel generators for power, the high price of energy drives up the cost of doing business in the North, also impeding economic development efforts.
Climate change is bringing both challenges and opportunities to the northern economy. Warming temperatures have led to permafrost degradation resulting in the deterioration of some infrastructure and has shortened the operating season and load capacity of winter roads, creating associated challenges to businesses and communities. However, melting ice conditions in the high Arctic also provides an opportunity for increased international shipping and tourism.
CanNor works closely with ISED and its portfolio organizations, and across government departments, to implement national activities, such as targeted support for clean technology activities, development of the Arctic Policy Framework (APF), regional growth strategies and the Accelerated Growth Service (AGS). This continued collaboration will support the Agency's efforts as it advances plans and priorities in support of northern economic development.