For the most current version of this Note, see Background Notes A-Z.



Area: 9.9 million sq. km. (3.8 million sq. mi.); second-largest country in the world.
Cities: Capital--Ottawa (pop. 1 million). Other major cities--Toronto (4.5 million), Montreal (3.4 million), Vancouver (2.0 million).
Terrain: Mostly plains with mountains in the west and lowlands in the southeast.
Climate: Temperate to arctic.

Nationality: Noun and adjective--Canadian(s).
Population (1996 census): 31.1 million.
Ethnic groups: British 28%, French 23%, other European 15%, Asian/Arab/African 6%, indigenous Amerindian 2%, mixed background 26%.
Religions: Roman Catholic 46%, Protestant 36%, other 18%.
Languages: English, French.
Education: Literacy--99% of population aged 15 and over have at least a ninth-grade education.
Health: Infant mortality rate--5.1/1,000. Life expectancy--76 yrs. male, 83 yrs. female.
Work force (15.3 million): Goods-producing sector: 26%. Manufacturing 15%; construction 6%; agriculture 2%; natural resources 2%; utilities 1%. Service-producing sector: 74%. Trade 16%; health care and social assistance 10%; educational services 7%, accommodation and food services 7%; professional, scientific, and technical services 6%; finance 6%; public administration 5%; transportation and warehousing 5%; information, culture, and recreation 5%; other services 5 %; management, administrative, and other support 4%.

Type: Confederation with parliamentary democracy.
Independence: July 1, 1867.
Constitution: The amended British North America Act of 1867 patriated to Canada on April 17, 1982, Charter of Rights and Freedoms, and unwritten custom.
Branches: Executive--Queen Elizabeth II (head of state represented by a governor general), prime minister (head of government), cabinet. Legislative--bicameral parliament (301-member House of Commons, 105-seat Senate). Judicial--Supreme Court.
Political parties: Liberal Party, Canadian Alliance, Bloc Quebecois, New Democratic Party, Progressive Conservative Party.
Subdivisions: 10 provinces, 3 territories.

If a scroll bar appears below the following table, swipe the table to move left/right of the dashed line.
Flag: Canada flag

Nominal GDP (2001): $700 billion.
Real GDP growth rate (2001): 1.5%.
Nominal per capita GDP (2001): $22,509.
Natural resources: Petroleum and natural gas, hydroelectric power, metals and minerals, fish, forests, wildlife, abundant fresh water.
Agriculture: Products--wheat, livestock and meat, feed grains, oil seeds, dairy products, tobacco, fruits, vegetables.
Industry: Types--motor vehicles and parts, machinery and equipment, aircraft and components, other diversified manufacturing, fish and forest products, processed and unprocessed minerals.
Trade: Merchandise exports (2001)--$266.8 billion: motor vehicles and spare parts, lumber, wood pulp and newsprint, crude and fabricated metals, natural gas, crude petroleum, wheat. 86% of 2001Canadian exports went to the United States. Merchandise imports (2001)--$226.4 billion: motor vehicles and parts, industrial machinery, crude petroleum, chemicals, agricultural machinery. 76% of 1998 Canadian imports came from the United States.

The bilateral relationship between the United States and Canada is perhaps the closest and most extensive in the world. It is reflected in the staggering volume of trade--the equivalent of $1.4 billion a day in goods, services, and investment income--and people, more than 200 million a year crossing the U.S.-Canadian border. In fields ranging from law enforcement cooperation to environmental cooperation to free trade, the two countries have set the standard by which many other countries measure their own progress. In addition to their close bilateral ties, Canada and the U.S. also work closely through multilateral fora.

Canada--a charter signatory to the United Nations and the North Atlantic Treaty Organization (NATO)--has continued to take an active role in the United Nations, including peacekeeping operations. Canada also is an active participant in discussions stemming from the Organization for Security and Cooperation in Europe (OSCE). Canada joined the Organization of American States (OAS) in 1990 and has been an active member, hosting the OAS General Assembly in Windsor in June 2000. In April 2001, Canada hosted the third Summit of the Americas in Quebec City. Canada serves as the 2002 G-8 chair and will host the G-8 summit in Kananaskis, Alberta, in June 2002. Canada also seeks to expand its ties to Pacific Rim economies through membership in the Asia-Pacific Economic Cooperation forum (APEC)--of which the U.S. also is a member.

Although Canada views its relationship with the U.S. as crucial to a wide range of interests, it also occasionally pursues policies at odds with the United States. Two significant examples of these differing policies involve UN treaties. Canada strongly supports the UN-created International Criminal Court (ICC) for war crimes, chairing the negotiations which led to its creation. The U.S. opposes the creation of the ICC due to fundamental flaws in the treaty that leave the ICC vulnerable to exploitation and politically motivated prosecutions. The United States and Canada also differed on the issue of landmines. Canada is a strong proponent of the Mine Ban Treaty, also known as the Ottawa Convention, which bans the use of anti-personnel mines. The United States, while supporting demining initiatives, declined to sign the treaty due to unmet concerns regarding the protection of its forces and allies, particularly those serving on the Korean Peninsula, as well as the lack of exemptions for mixed munitions.

U.S. defense arrangements with Canada are more extensive than with any other country. The Permanent Joint Board on Defense, established in 1940, provides policy-level consultation on bilateral defense matters. The United States and Canada share NATO mutual security commitments. In addition, U.S. and Canadian military forces have cooperated since 1958 on continental air defense within the framework of the North American Aerospace Defense Command (NORAD). The military response to the terrorist attacks of September 11, 2001 both tested and strengthened military cooperation between the United States and Canada. Canada's participation in the military action in Afghanistan raised public debate about the role of the Canadian military and the limits of Canada's military capabilities.

The two countries also work closely to resolve transboundary environmental issues, an area of increasing importance in the bilateral relationship. A principal instrument of this cooperation is the International Joint Commission (IJC), established as part of the Boundary Waters Treaty of 1909 to resolve differences and promote international cooperation on boundary waters. The Great Lakes Water Quality Agreement of 1972 is another historic example of joint cooperation in controlling transboundary water pollution. The two governments also consult semiannually on transboundary air pollution. Under the Air Quality Agreement of 1991, both countries have made substantial progress in coordinating and implementing their acid rain control programs and signed an annex on ground level ozone in 2000.

While law enforcement cooperation and coordination were excellent prior to the terrorist attacks on the United States of September 11, they have since become even closer. Canada, like the United States, has strengthened its laws and realigned resources to fight terrorism. U.S.-Canada bilateral and multilateral cooperation in the fight is unequaled.

Trade and Investment
The United States and Canada have the world's largest bilateral trading relationship. In 2001, the equivalent of $1.4 billion a day in goods, services, and investment income crossed the U.S.-Canada border. In fact, total two-way trade in goods between the United States and Canada is larger than total U.S. goods trade with the entire 15-country European Union. Indeed, the two-way trade that crosses the Ambassador Bridge between Michigan and Ontario equals all U.S. exports to Japan. Canada's importance to the United States is not just a border-state phenomenon: Canada is the leading export market for 35 of 50 U.S. States.

In 1989, the U.S.-Canada Free Trade Agreement (FTA) went into effect and was superceded by the North American Free Trade Agreement (NAFTA) in 1994. Between 1989 and 1994, bilateral trade increased by about 50%. Since the implementation of NAFTA in 1994, total two-way merchandise trade between the United States and Canada has grown by 125 %. When services are added, the growth has been 142%. This is because the NAFTA continues the FTA's moves toward reducing trade barriers and establishing agreed upon trade rules. It also resolves some long-standing bilateral irritants and liberalizes rules in several areas, including agriculture, services, energy, financial services, investment, and government procurement. NAFTA forms the largest trading area in the world, embracing the 406 million people of the three North American countries.

Canada has evolved from a rural, commodity-based economy to an urban services-dependent economy with a large manufacturing base. Since Canada is the largest export market for 35 to 50 States, the U.S.-Canada border is extremely important to the well-being and livelihood of millions of Americans.

The U.S. is Canada's leading agricultural market, taking nearly one-third of all food exports. Conversely, Canada is the second-largest U.S. agricultural market (after Japan), primarily importing fresh fruits and vegetables and livestock products. Of Canada's $27 billion in exports of wood, pulp, and paper in 2001, 80% went to the United States.

At $38 billion in 2001, U.S.-Canada trade in energy is the largest U.S. energy trading relationship in the world. The primary components of U.S. energy trade with Canada are oil, natural gas, and electricity. Canada is the United States' largest oil supplier and the fifth-largest energy producing country in the world. Canada provides about 16% of U.S. oil imports and 14% of total U.S. consumption of natural gas. The United States and Canada's national electricity grids are linked and both countries share hydropower facilities on the Western borders.

While 98% of U.S.-Canada trade flows smoothly, there are occasionally bilateral trade disputes over the remaining 2%, particularly in the agricultural and cultural fields. Usually, however, these issues are resolved through bilateral consultative forums or referral to WTO or NAFTA dispute resolution. For example, in response to World Trade Organization (WTO) challenges by the United States, the U.S. and Canadian Governments negotiated an agreement on magazines that will provide increased access for the U.S. publishing industry to the Canadian market, and Canada amended its patent laws to extend patent protection to 20 years. Canada currently has several disputes with the United States pending in the WTO, all of them related to actions taken by the U.S. Government on softwood lumber. The United States and Canada also have resolved several major issues involving fisheries. By common agreement, the two countries submitted a Gulf of Maine boundary dispute to the International Court of Justice in 1981; both accepted the Court's October 12, 1984 ruling which demarcated the territorial sea boundary.

The United States and Canada signed a Pacific Salmon Agreement in June 1999 that settled differences over implementation of the 1985 Pacific Salmon Treaty. In 2001, the United States and Canada reached agreement on Yukon salmon, implementing a new abundance-based resource management regime for West Coast salmon.

In 1995, the United States and Canada signed a liberalized aviation agreement, and air traffic between the two countries has increased dramatically as a result. U.S. immigration and customs inspectors provide preclearance services at seven airports in Canada, allowing air travelers direct connections in the United States. The two countries also share in operation of the St. Lawrence Seaway, connecting the Great Lakes to the Atlantic Ocean.

The U.S. is Canada's largest foreign investor. Statistics Canada reports that at the end of 2001, the stock of U.S. foreign direct investment in Canada was $138.8 billion, or about 72% of total foreign direct investment in Canada. U.S. investment is primarily in Canada's mining and smelting industries, petroleum, chemicals, the manufacture of machinery and transportation equipment, and finance.

Canada is the third-largest foreign investor in the United States. At the end of 2001, the stock of Canadian direct investment in the United States was estimated at $90.4 billion. Canadian investment in the United States, including investments from Canadian holding companies in the Netherlands, was $128.1. Canadian investment in the United States is concentrated in manufacturing, wholesale trade, real estate, petroleum, finance, and insurance and other services.

Principal U.S. Embassy Officials
Ambassador--Paul Cellucci
Deputy Chief of Mission--Stephen Kelly
Minister-Counselor for Political Affairs--Brian Flora
Minister-Counselor for Economic Affairs--Michael Gallagher
Minister-Counselor for Public Affairs--James Williams
Minister-Counselor for Commercial Affairs--Delores Harrod
Minister-Counselor for Consular Affairs--Leslie Gerson

The U.S. Embassy in Canada is located at 490 Sussex Drive, Ottawa, Ontario, K1N 1G8 (tel. 613-238-5335).

Canada is a constitutional monarchy with a federal system, a parliamentary government, and strong democratic traditions. Many of the country's legal practices are based on unwritten custom, but the federal structure resembles the U.S. system. The 1982 Charter of Rights guarantees basic rights in many areas.

Queen Elizabeth II, as Queen of Canada, serves as a symbol of the nation's unity. She appoints a governor general, who serves as her representative in Canada, on the advice of the prime minister of Canada, usually for a 5-year term. The prime minister is the leader of the political party in power and is the head of the cabinet. The cabinet remains in office as long as it retains majority support in the House of Commons on major issues.

Canada's parliament consists of an elected House of Commons and an appointed Senate. Legislative power rests with the 301-member Commons, which is elected for a period not to exceed 5 years. The prime minister may ask the governor general to dissolve parliament and call new elections at any time during that period. Federal elections were last held in November 2000. Vacancies in the 104-member Senate, whose members serve until the age of 75, are filled by the governor general on the advice of the prime minister. Recent constitutional initiatives have sought unsuccessfully to strengthen the Senate by making it elective and assigning it a greater regional representational role.

Criminal law, based largely on British law, is uniform throughout the nation and is under federal jurisdiction. Civil law is also based on the common law of England, except in Quebec, which has retained its own civil code patterned after that of France. Justice is administered by federal, provincial, and municipal courts.

Each province is governed by a premier and a single, elected legislative chamber. A lieutenant-governor appointed by the governor general represents the Crown in each province.

Principal Government Officials
Head of State--Queen Elizabeth II
Governor General--Adrienne Clarkson
Prime Minister--Jean Chretien
Minister of Foreign Affairs--William Graham
Ambassador to the United States--Michael Kergin
Ambassador to the United Nations--Paul Heinbecker

Canada maintains an embassy in the United States at 501 Pennsylvania Avenue, NW, Washington, DC 20001 (tel. 202-682-1740).

Prime Minister Jean Chretien's Liberal Party won a major victory in the November 2000 general elections. Chretien became the first Prime Minister to lead three consecutive majority governments since 1945, as the Liberals increased their majority in Parliament to 57% (172 of the 301 Parliamentary seats). The Canadian Alliance Party, which did well in western Canada but was unable to make significant inroads in the East, won the second-highest total of seats (66).

Federal-provincial interplay is a central feature of Canadian politics: Quebec wishes to preserve and strengthen its distinctive nature; western provinces desire more control over their abundant natural resources, especially energy reserves; industrialized central Canada is concerned with economic development; and the Atlantic provinces have resisted federal claims to fishing and mineral rights off their shores.

The Chretien government has responded to these different regional needs by seeking to rebalance the Canadian confederation, giving up its spending power in areas of provincial jurisdiction, while attempting to strengthen the federal role in other areas. The federal government has reached agreement with a number of provinces returning to them authority over job training programs and is embarked on similar initiatives in other fields. Meanwhile, it has attempted to strengthen the national role on interprovincial trade, while also seeking national regulation of securities.

National Unity
The issue of Quebec and the separatist movement there remains an important concern. Following the failure of two constitutional initiatives in the last 14 years, Canada is still seeking a constitutional arrangement that will satisfy the aspirations of the French-speaking province of Quebec. The issue has been a fixture in Canadian history, dating back to the 18th century rivalry between France and Britain. For more than a century, Canada was a French colony. Although New France came under British control in 1759, it was permitted to retain its religious and civil code.

The early 1960s brought a Quiet Revolution to Quebec, leading to a new assertiveness and heightened sense of identity among the French-speaking Quebecois, who make up about 20% of Canada's population. In 1976, the separatist Parti Quebecois won the provincial election and began to explore a course of greater independence for Quebec. This led to a 1980 referendum in which the Parti Quebecois unsuccessfully sought a mandate from Quebeckers to negotiate a political independence for Quebec. Subsequently, an agreement between the federal government and all the provincial governments except Quebec led to Canada assuming from the United Kingdom full responsibility for its own constitution. Quebec objected to the new arrangement, particularly to a provision that did not require the consent of all provinces for constitutional amendments. Several attempts to find a formula to include Quebec failed, leading in 1995 to another referendum on sovereignty in Quebec. This time the Parti Quebecois lost by slightly over 1% in its bid to win a mandate to negotiate political independence.

The 1995 referendum proved a high water mark, and since that time support for holding a third referendum has declined. Though the Parti Quebecois is still in power in quebec, sentiment for separatism seems to be declining, and another referendum is unlikely in the near future.

[This is a mobile copy of Canada (06/02)]

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