With political and economic instability growing around the world, havens of stability and calm will be increasingly sought out by the aspirational middle classes, the wealthy, international businesses, and savvy investors. Canada is one of those safe havens.
While we are in no way a country bereft of serious issues, our political system is stable and not as divided as structures in the U.S., Europe, and parts of the Middle East. Our economy is in decent shape, and we have lots of untapped potential long term. We are also a tolerant and open society where openness to polarizing rhetoric is extremely limited and always has been. The world is well aware of our positives, and Canada has a solid international brand.
In Vancouver, the foreign buyers tax, shifting psychology, and an activist NDP government in Victoria have all blunted real estate. Developers continue to hold back on new construction and prices continue to fall. Chinese money no longer looks to Vancouver real estate as a safe haven. The city has worn out the welcome of foreigners and the shock of government intervention has not lifted. While Toronto’s foreign buyer tax remains unpopular with the real estate lobby, the city’s economic preponderance and heft have allowed it to absorb the consequences of the foreign buyer tax well. Significant sums of money were redirected to Toronto in light of Vancouver’s foreign buyer tax briefly, and much of that momentum is now moving further east; to Ottawa and Montreal.
In Hong Kong, the political situation is becoming dire. The Chinese government has assembled significant military infrastructure adjacent to the city and has warned that its patience in tolerating the city’s mass protests is almost up. A direct Chinese military intervention is restoring stability to the global financial hub would have a drastic and immediate impact on the Hong Kong economy and its status as a stable centre of finance and business. Media reports in Canada and abroad are already suggesting that Hong Kong residents of means will begin moving out of the city to Taiwan, Singapore, and Korea. They will of course, be transferring their money and assets out of the city if they fear that a Chinese crackdown on dissent would affect their livelihoods. Either way, for now, Canada is well positioned to continue to be perceived as a financial and political safe place in a turbulent world.