Ottawa – The Canada’s economy is going through a tough phase. Household debt in the country, i.e. debt on families, has now reached 103 percent of GDP. This means that Canadian citizens have a debt of more than the country’s total GDP, which includes both interest and principal.
These figures show that Canadians are burdened with debt far more than their disposable income, which has seriously threatened the country’s economic stability. Because of this imbalance, Canadians have to take excessive loans to buy properties and for other essential expenses.
Analysts believe that this debt is a dangerous sign for the country’s economic health. In countries where household debt is high, families have to face financial uncertainty. After Canada, Britain comes next, where people have a debt of 80 percent of the country’s GDP. In other countries, this ratio is comparatively low, such as 73 percent in the US, 63 percent in France, 62 percent in China and 52 percent in Germany. On the other hand, this figure in India is 37 percent, which is much lower than Canada, which shows that the debt burden on Indian families is less.
Canada’s troubles do not end here. After Donald Trump’s victory in the recent presidential elections in the US, Canada’s economic situation is likely to come under more pressure. Trump had promised in his election campaign to impose high tariffs on imports and review the North America Free Trade Agreement. If Trump takes this step, then Canada’s trade relations with America, its largest trading partner, may be affected, which can cause a big blow to the country’s economy.
Experts say that if this is not taken care of, the country may have to face economic instability. Due to increasing debt, Canadians are facing inflation and financial uncertainties. In such a situation, it remains to be seen what steps the Canadian government takes to deal with this crisis, so that the country can maintain economic balance and people can get freedom from the debt trap.
