A 2012 Bank of Canada study on competitiveness and Canada’s declining share of world trade found that Canada’s share of world exports had fallen from 4.1 per cent in 1990-2000 to 3.7 per cent in 2001-07 and 2.8 per cent in 2008-10.

Moreover, Canada became much more dependent on commodity exports—energy exports rose from 10.1 per cent of Canadian exports in 1990-2000 to 17.2 per cent in 2001-07 and 24.7 per cent in 2008-10. Non-energy commodities accounted for another 30.3 per cent of exports in 2008-10. At the same time, automotive exports fell from 22.1 per cent of the total in 1990-2000 to 11.2 per cent in 2008-10 while machinery and equipment exports fell from 17.8 per cent in 1990-2000 to 15.9 per cent in 2008-10.

We need to be better exporters. As Bank of Canada Governor Stephen Poloz said in a recent speech in Drummondville, Que., oil exports are “the main source of natural growth in our economy today” but “growth in energy exports alone cannot make up for the loss of exports we have experienced since the crisis [the Great Recession].”

The persistent strength of the Canadian dollar, over dependence on the U.S. market, stiffer competition from China and Mexico and technological change were all factors in Canada’s loss of competitiveness— which translates into fewer good jobs, a smaller economy and less government revenue. A nation with a weak tradable goods sector will end up relying increasingly on international debt, as the U.S. has done, to finance its domestic consumption.

As a country, we face a huge challenge in building a prosperous and sustainable economy for the future. A U.S. recovery and a somewhat weaker Canadian dollar would help a bit. But something more fundamental is needed—major investments in advanced manufacturing and high-value business services are critical