- About VEC
- Think Vancouver
- Vancouver Economy
- Key Sectors
- Invest in Vancouver
- Data Centre
- Grow Your Business
- Event Listings
- Bizmap BC
- Contact Us
Vancouver has a dynamic, highly diversified urban economy with growing knowledge-based sectors and strong global linkages.
Greater Vancouver, with a population of 2.3 million, is Canada’s third largest urban area. Located in British Columbia, Canada’s westernmost province, the region covers nearly 2,900 square kilometres, bordered by the Pacific Ocean to the west, the US border to the south, the valley of the Fraser River to the east and the Coastal Mountains to the north. Seattle, Washington is 226 km to the south, while Calgary, Alberta is 975 km to the east. Vancouver’s oceanside location gives it a mild climate year round.
Vancouver is consistently ranked as the world’s most livable city by the Economist Intelligence Unit and Mercer. .
Back to Top
Canada is a federal state; the governments of Canada and British Columbia both play a role in establishing Vancouver’s business climate.
The Vancouver region, comprising the City of Vancouver and 21 other municipalities, accounts for close to half of British Columbia’s population and economic output. A region-wide authority, Metro Vancouver, has responsibility for water supply, sewage treatment, garbage disposal and recycling, and other activities. Economic development activities in the region are coordinated by an alliance of municipal economic development agencies known as Metro Vancouver Commerce.
The City of Vancouver is the largest municipality in the region in terms of population and economic activity. The city’s economic development agency, the Vancouver Economic Commission (VEC), is a founding member of Metro Vancouver Commerce, and participates in all Metro Vancouver Commerce activities. The city’s downtown includes more than half of all commercial office space in the region and serves as the international front door to British Columbia.
Back to Top
Canada is enjoying solid economic performance and a highly favourable business climate. Canada’s 2008 Budget noted:
The 2008 KPMG Competitive Alternatives study found Canada has the lowest business costs in the G7. It leads the G7 in manufacturing, software and R&D costs.
KPMG ranked Canada first in the G7 for high school science scores, and second in educational attainment and expenditure. Canada ranked first in the G7 for environmental laws and second for environmental performance. Canada leads the G7 in energy self-sufficiency.
British Columbia’s economy is currently outperforming that of Canada, and its business climate is among the most favourable of all Canadian provinces.
As noted in its 2008 Budget, the Government of British Columbia has taken major steps to create a stable and competitive tax environment in the province.
The general corporate income tax rate has been reduced from 16.5 per cent in 2000 to 10 per cent in 2011. Together with federal tax reductions, this will result in a combined federal and provincial tax rate of 25 per cent by 2012 – well below the average US rate of 35 per cent. The small business tax rate has been reduced to 3.5 per cent with planned further reductions to 2.5 per cent by 2011.
The threshold for the small business tax rate has been increased to $400,000. Business tax burdens in British Columbia are among the lowest anywhere in North America.
A number of major personal income tax reductions have also been enacted, cutting income tax rates by a third, with the result that British Columbia has the lowest income tax rates in Canada for incomes up to $111,000. Top marginal personal income tax rates remain below those in jurisdictions such as California and Ontario.
Other recent tax reductions include the elimination of the corporate capital tax – on large financial institutions by 2010.
The B.C. government has a strong record of sound fiscal management. A balanced budget is required by law and the Province will end the 2007/8 fiscal year with its fourth consecutive budgetary surplus. Its ratio of tax supported debt to GDP has fallen from 21.3 per cent in 2002/3 to an estimated 14.1 per cent in 2007/8 and is expected to remain below 14 per cent in future years. The B.C. government enjoys the highest ratings on its debt from both Moody’s and Standard & Poor’s.
The B.C. government is a North American leader in the use of public-private partnerships (PPPs) to deliver public-use infrastructure. PPP transfer project risk from government to the private sector through fixed price agreements, guaranteed delivery dates and performance guarantees. About $4.7 billion in PPP projects are completed or under construction, while an additional $2.7 billion in projects is at the competitive selection stage. More than 20 PPP projects have been, or are scheduled to be, delivered on time and on budget.
British Columbia has an on-going program aimed at modernizing the regulatory system to promote innovation and economic opportunity, while protecting the public interest. Since the program began in 2001, regulatory burdens have been reduced by over 40 per cent.
British Columbia has been long recognized as a North American leader in advancing environmental sustainability. The B.C. government recognizes that an attractive business climate addresses long-term sustainability issues, such as climate change, as well as short term returns on investment. Its 2008 Budget introduced one of the most progressive climate action plans in the world, aimed at reducing GHG emissions to 33 per cent below 2007 levels by 2020. A key element of the plan is a revenue neutral carbon tax, set at $10 per tonne of emissions in 2008, rising to $30 per tonne by 2012. Taxes raised on carbon will be offset by tax reductions, so the net impact on business and individual taxpayers
will be zero.
The carbon tax is part of a much broader set of climate change initiatives, including incentives and tax reductions for energy efficiency upgrades; increased funding for research and energy-related technologies; a “cap and trade” system for large emitters; major transit system expansions; and new demand power management systems.
Back to Top
The regional population has been growing about 1.3 per cent annually in recent years; increases are expected to continue over the next decade, with the population reaching 3 million by 2030. While some suburban municipalities are growing more rapidly, the city of Vancouver continues to see healthy population growth.
With the natural rate of population growth steadily declining, population growth is driven primarily by immigration. Canadian and B.C. government policies encourage immigration of people with business and employment-related skills. Immigrants account for 40 per cent of the region’s population. This high proportion of foreign born individuals provides Vancouver with a talented and diverse labour pool, with strong international connections.
Immigrants to Canada are well educated: among those immigrating between 2001 and 2006, half had a university degree. Among working age individuals, immigrants account for half of all doctorate degrees and over 40 per cent of master’s degrees. Immigrants are also, overall, younger than native born Canadians.
According to the OECD, Canada has the highest proportion of people aged 25-64 with a college or university certificate among all OECD countries.
Greater Vancouver’s population is better educated than the Canadian average. According to the 2006 Census, 31 per cent of the working age population has a university degree (Canadian average: 23 per cent) and fully 57 per cent has a university or college education (Canadian average: 48 per cent).
Vancouver’s global gateway role is evident in the comparatively high proportion (5.7 per cent) of people working in the transportation industry.
Back to Top
Vancouver and British Columbia are enjoying one of the strongest economic expansions on record. Over the past five years, the provincial economy has consistently outpaced the Canadian economy.
Looking ahead, the province, propelled in large part by strength in the Greater Vancouver region, is positioned to continue to outperform the national benchmark. There is widespread agreement among economists and other forecasters that British Columbia will remain at or near the top of the provincial growth rankings in the coming years. Among other factors, a competitive business and tax climate, Asia Pacific and the growing gateway role, the successful hosting of the Vancouver 2010 Olympic and Paralympic Winter Games, high rates of immigration, high levels of investment and construction, a diverse and skilled workforce and a growing advanced technology sector all contribute to the positive outlook.