tions, led by Nortel Networks Corporation, played
an important part in this diversification. The manu-
facturer of the BlackBerry (first released in 1999),
widely used in business in the United States, is Re-
search In Motion, a Canadian firm. The business
software sector also thrived in central Canada, which
is within easy reach of many businesses in the United
States, as exemplified by JDS Uniphase and Cognos,
both based in Ottawa. A relatively new college,
Sheridan College, specializing in software and lo-
cated in Ontario, supported this diversification.
Overall, however, manufacturing as a proportion
of the economy declined during the decade. During
the early 1990’s, a period of very restrained eco-
nomic development, the metropolitan region of To-
ronto, at the heart of Canadian business, suffered se-
rious business losses, leading to a sharp decline in
employment, especially in insurance and finance,
which had been heavily concentrated in Toronto
and Montreal. Globalization negatively affected
Quebec, where manufacturing had been concen-
trated in textiles and clothing.
Foreign Trade Despite Canada’s shift away from a
staples economy, the country remains a major pro-
ducer of natural resources, of both forest products
and mining and mineral resources. Canada pro-
duces about one-fifth of the world’s softwood lum-
ber (mostly from the hugely productive forests of
British Columbia on the Pacific coast), as well as
25 percent of the world’s newsprint, and 16 percent
of market pulp (the raw material for paper). The for-
est products sector is a major producer of net for-
eign income for Canada.
Unfortunately, the conflict with the U.S. forest
products community that arose in the 1980’s over
softwood lumber continued in later decades. Essen-
tially, U.S. lumber producers claimed that Canadian
lumber was effectively subsidized, because the price
Canadian loggers were paying landowning provin-
cial governments was less than the price U.S. loggers
had to pay to the private landowners from whom
they bought most of the trees they logged. Though
the conflict was initially settled by compromise dur-
ing the 1990’s, it has continued to negatively affect
U.S.-Canadian trade relations despite the provisions
of the North American Free Trade Agreement
(NAFTA), established in 1994.
Canada produces a substantial proportion of the
world’s newsprint, which is made from small forest
trees. Even though paper pulp is now a commodity
product, and though paper mills have faced difficult
economic times, Canada’s newsprint and paper
pulp industry remains an important source of ex-
port earnings. Further, Canada continues to be a
source of vital minerals. In addition to the tradi-
tional minerals produced by International Nickel’s
plant in Sudbury, Ontario, a very large, new source
of nickel was discovered in Labrador during the
1990’s. Diamonds have been found in several places
in the Northwest Territories. Exploration continues,
and new finds assure that Canada will continue to be
a source of critical minerals. Finally, the tar sands in
Alberta have gained new importance, as access to
other petroleum assets are impacted by geopolitical
developments. Though the low petroleum prices of
the 1990’s restrained development of the tar sands
as a source for oil that could be converted into gaso-
line, the natural gas associated with the tar sands
provided important export earnings for Canada.
Under pressure from Canadian business, the gov-
ernment entity Petro-Canada was privatized in 1991.Impact Although Canada’s economy remains a
small fraction of the size of that of the United States,
its important resources contributed significantly to
the American economy in the 1990’s.Further Reading
Britton, John N. H., ed.Canada and the Global Econ-
omy: The Geography of Structural and Technological
Change. Montreal: McGill-Queen’s University
Press, 1996. Contains articles by assorted experts
on the various sectors of Canada’s economy.
Statistics Canada.The Canadian Economic Observer:
Historical Statistical Supplement 2000/01.Ottawa:
Ministry of Industry, 2001. Contains numerous
tables on Canada’s economy.
Wallace, Iain.A Geography of the Canadian Economy.
New York: Oxford University Press, 2002. A com-
pact but comprehensive and useful account of
the Canadian economy.
Nancy M. GordonSee also Agriculture in Canada; Automobile in-
dustry; Business and the economy in the United
States; Canada and the United States; Downsizing
and restructuring; Income and wages in Canada;
North American Free Trade Agreement (NAFTA);
Recession of 1990-1991.The Nineties in America Business and the economy in Canada 133