June 12, 2025 • 44 mins
The energy conversation is polarizing. But the reality is multidimensional. Get the full story with host Stewart Muir.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Tej Parikh (00:00):
This started from amusing, really, just looking at
the global map and realizinghold on, you know, canada is
absolutely enormous.
It's a G7 nation and yet why dowe not hear about Canada when
we talk about global superpowers?
And then, as you dig deeper,you realize OK, so Canada's
second largest country bylandmass has the longest
(00:22):
coastline.
Country by landmass has thelongest coastline.
And then when you look intowhat it has on the ground in
terms of its mineral resourcesand then the energy resources in
terms of oil and natural gasthe more traditional raw
materials for energy today youbegin to build up this picture
that you know there's anenormous economic potential here
, very much the same geographicadvantages that have underpinned
(00:45):
America's economic emergenceover the last 100 years Having a
very strong coastline both onthe Pacific coast and the
Atlantic.
Given everything we understandabout the advantages that
countries need to grow, why isCanada not doing better
economically?
Stewart Muir (01:13):
If you're enjoying Power Struggle, make sure to
subscribe, share this episodeand leave us a review.
It helps us keep fact-basedenergy conversations going and
gets these voices into more ears.
Canada, as the host of the 2025G7 Summit in Kananaskis, stands
at a pivotal moment.
The promise of Prime MinisterMark Carney turning Canada into
(01:39):
an economic and energysuperpower is bold, intriguing
and perhaps challenging Toexplore whether Canada is truly
ready to seize this ambitiousgoal today.
I'm delighted to welcome ourguest.
Tej Parikh is the FinancialTimes' economics editorial
writer.
He also writes the Sundayversion of the Free Lunch
newsletter, which I love to getin my email.
It covers the global economicpolicy debate.
(02:02):
Before joining the FinancialTimes, the FT, he was a director
of economics at the FitchRatings Company and chief
economist at the Institute ofDirectors, and he was previously
an economist at the Bank ofEngland.
Tej has also written fornumerous international outlets
on issues covering globalaffairs and public policy, and
(02:23):
he was once a journalist for theCambodia Daily in Phnom Penh.
Welcome, tej, thank you.
Thank you for having me.
Great to see you.
You wrote a piece recently allabout Canada.
It was just so informative and,in a funny way, it made the
topics you covered much moresignificant to readers in Canada
because it came from an outsidesource.
(02:45):
So, tej, what has Canada gotthat would make it a superpower,
do you think, in terms ofnatural resources?
Tej Parikh (02:53):
Yeah, well, I mean, this started from amusing,
really, just looking at theglobal map and realizing, hold
on, Canada is absolutelyenormous.
Realising hold on, you know,canada is absolutely enormous.
It's a G7 nation and yet why dowe not hear about Canada when we
talk about global superpowers?
So then I thought initially thiscould form a very interesting
(03:16):
column idea, just to explore.
And then as you dig deeper yourealise, okay, so Canada is, you
know, second largest country bylandmass, has the longest
coastline, and then when youlook into what it has on the
ground in terms of its mineralresources, the vast critical
mineral resources it has, andthen the energy resources in
(03:37):
terms of oil and natural gas,which are kind of the more
traditional raw materials forenergy today, which are kind of
the more traditional rawmaterials for energy today, you
begin to build up this picturethat you know there's an
enormous economic potential here.
And then you just throw in thefact that geographically, you
have essentially very much thesame geographic advantages that
(04:00):
have underpinned America'seconomic emergence over the last
100 years, and that's, you know, having a very strong coastline
both on the Pacific coast andthe Atlantic.
So all of these kind ofadvantages, I felt really played
(04:21):
into this question.
You know why is Canada notdoing better economically than
we might expect, giveneverything we understand about
the advantages that countriesneed?
Stewart Muir (04:35):
to grow.
Well, you've hit on somethingimportant.
I think that's what resonatedand I believe I shared that in
my social media.
A lot of people were suddenlytalking about it and you know
your external position.
But I think the fact that youcovered so much ground in that
you talked about the differentmetals and minerals, you talked
about the potash that goes tothe US and grows a lot of their
(04:57):
food, and you had a wonderfulmap that I shared in LinkedIn
and everyone was talking aboutthat.
Your colleagues did a great jobat the FT.
But then your newsletter piecewas just full of relevant charts
and graphs and in the YouTubeversion of this we'll share a
few of the visuals so people cansee.
But I must say congrats ondoing a really thorough piece.
(05:21):
I've rarely seen that done.
I was kind of envious because Ihey, I like to tell the
resource story.
I was kind of envious because Ihey, I like to tell the
resource story.
It's part of what I do inCanada here.
Tej Parikh (05:29):
I was personally quite surprised by how viral
that went in Canada and I thinka lot of the conversations or
the responses I got back fromCanadians was it was actually
quite split.
If I'm honest with you, therewere a lot of people with a very
similar view to you, being veryoptimistic that you know
(05:50):
somebody from Europe has, youknow, spotted all these
advantages and is telling thestory of the country and the
potential of the country.
But I think obviously when youtalk about natural resources,
when you're talking about energy, there is obviously a tension
there.
Environmentalists in particularand those who are wanting to
(06:10):
protect the indigenous rights ofindigenous communities in
Canada are obviously concerned.
So there was a bit of a splitresponse in the two and I think
one thing that I wasn't tryingto imply was that you know, look
, here's a country with tons ofresources that we just need to
plunder.
My kind of point was more thathere's a country that has a
(06:36):
number of resources that canprovide a focal point for its
development and its emergence,and let's not forget that the
world is trying to make thistransition to the green economy.
So this doesn't have to beabout being anti-environmental.
It's about creating thosesupply chains and critical
minerals that the Western worldis currently, you know, short of
(06:58):
.
Stewart Muir (06:59):
I felt your piece struck exactly the right tone in
that, because you weren'tadvocating, you were reporting,
but I think it did come aroundto that.
And one of the intriguingthings and you've referenced
this is the potential.
I mean you argue that Canada,with this geography, its
placement and resources, itcould spark an economic boom.
But why hasn't it?
And I know the Financial Timesis a companion publication to
(07:23):
the Economist and the Economistrecently wrote that if Canada
was a US state, it would beAlabama in economic terms, which
no one thinks is a compliment,although Alabama is a wonderful
place.
I mean, how do we go fromAlabama to superpower?
Are we over-optimistic?
Tej Parikh (07:40):
So when you break it down and you look at why income
per capita in Canada hasperhaps not increased as fast as
we might expect on the basis ofthose advantages, it really
kind of breaks down to threecomponents.
(08:01):
I mean one is investment, sohow much capital goes into the
country.
The second is labor, and notjust the amount, the size of the
workforce you have, but howwell you utilize the workforce.
And then the third component issomething that economists like
to call a total factorproductivity, which is
(08:23):
essentially your innovativeability and your ability to
bring together capital andpeople.
And when you look at Canada asopposed to other large economies
although this is a challengefor a lot of large economies is
its ability to integrate all itsresources together.
So can different provincestrade effectively?
(08:45):
Can workers move from oneprovince to find a job in
another?
And when you begin to see thatactually there are a lot of
restrictions in Canada, not justbecause of its vast geography
but because of regulation, thatit actually can't combine its
capital and labour asproductively as it could you
know these internal tradebarriers in Canada it became
(09:08):
quite a central piece of theanalysis for me.
And, you know, I think thoseare the three key reasons,
really, why Canada hasn't reallygrown as fast as it could have.
Stewart Muir (09:20):
Well, this is the time to be talking about these
things.
You know, in Canada itsometimes feels like there's a
cringe that we have urbanresidents, especially that we've
got all these great things thatexist here.
But wouldn't it be better if wewere Silicon Valley or
(09:43):
Switzerland and produced nicewatches or something that was a
little more glam?
Yet I can't think of one thingthat the world does anywhere
that doesn't depend on materialinputs of some kind or energy
products.
It could be hard to see, butthey're there.
Is there a mythology that theworld sees about Canada that we
should be uneasy about thatwe're these kind of lumberjack
(10:07):
types hewers of wood and haulersof water, and that, yeah, we're
kind of primitive as an economyand that's something to be
ashamed of.
Is that a real thing that isseen outside?
Tej Parikh (10:21):
I don't think so.
I don't think so.
(10:52):
I mean in that way.
If anything, what I would saywith canada is I mean, most of
the western worlds, you know us,europe included has kind of got
into the function of doingthese high-tech service industry
.
You know the sexier type ofjobs at home and then importing
(11:14):
raw materials from China orIndia or you know parts of Asia.
Now, what we clearly know fromthe last five years of looking
at geopolitics and economics isthat being over-reliant on
particular supply chains isn'tthe best thing, but also not
having those competencies athome is also a difficulty.
(11:35):
So if you don't have people whowork in manufacturing or
construction, you lose theability to have an agile economy
.
So I think in Canada thatdiversity is its strength, if
anything, and I think, given ithas these vast raw material
resources, there is a massivescope for it to become even more
(11:58):
integrated into Western supplychains in particular and to
become a supplier of thesethings.
Stewart Muir (12:03):
I'm in Western Canada, here, tejan, we had a
deal announced last week by oneof the big midstream energy
companies, a company calledEnbridge, that they have done a
deal with more than 30 FirstNations for that that syndicate
to purchase a large piece of agas transportation network
including pipelines, and thatwas, I'm going to say, one of,
(12:26):
if not the most significantFirst Nations deal in oil and
gas infrastructure.
We've seen some big deals inhydro in Quebec and other in
Ontario as well, but one of thebiggest and this will empower a
generation of uplift for theFirst Nations involved.
In the view of those FirstNations, they voluntarily came
into this, so I mean that's agood news story.
(12:48):
Is there something that wecould be doing differently in
Canada to get that story out?
Is there a way to be morecompelling about information we
think is valid, aboutinformation we think is valid?
Tej Parikh (12:58):
Well, I mean, I wouldn't be taking marketing
advice from a Brit.
We're not the best at marketingthe UK, we're notoriously quite
downbeat and I think, actuallyoddly, what I would say is, over
the last you know, four to sixmonths.
You know it's a weird offshootof Donald Trump's return to the
(13:19):
White House, but you know,canada has been thrust into the
spotlight.
I also think the new PrimeMinister, mark Carney, is a good
leader on the world stage and Ithink that will also kind of
raise Canada's stature and heseems to be talking about the
right things in terms of theseopportunities.
You know, dovetailing quitewell with some of the points I
(13:41):
made actually in my articleabout what the opportunities
Canada can do and the potentialit has.
I think one of the things thatis a bit of a crossover with the
UK and perhaps other countriesdo this better is for the
foreign direct investor who isthinking about setting up in
(14:03):
another country.
You know how easy is it forthem to know what opportunities
are available in Canada and godown to the province level and
then also understand okay, if Idid want to invest in a certain
project in this province, whatare the regulations, what are
the tax requirements?
(14:23):
What if I want to then sellinto another province?
You know these are the types ofquestions.
I think it's the real the, thedetail that kind of gets the
invest.
The investors right now willknow that Canada has all of this
latent potential, they willknow that there is resources
there, they will know that thereis talented workers in Canada.
(14:47):
But it's just the answers towhat barriers there are to
business and how they can bereduced, and I think that's the
piece that Canada and itsprovinces can do a better job on
, and it already is.
I think what's been verypositive and I think it's been
picked up here is the discussionaround internal trade barriers
(15:12):
in Canada between provinces.
Now, the reason why this is soprominent in the minds of
European investors in particularis that the European Union is,
you know, effectively it's aneconomic union, but it's split
among 27 member states withvarious different regulations
and been trying to find ways toharmonise and improve that for
(15:36):
investors, and investors hereconstantly make this point that
I don't have access to this hugemarket if everyone's got
various different regulations,and I think that's the.
That's the thing that I thinkcanada would benefit from
showing how it is a kind of amore unified country and showing
(15:56):
how that it is a unifiedmarketplace where investors and
businesses can develop expansivesupply chains.
Stewart Muir (16:06):
If Europe can do it, canada should be able to,
and it's been a big talkingpoint in business and government
circles lately to do that.
So hopefully the resolvebrought about by this current
crisis will turn into something.
Look, taj, our prime ministerbefore Justin Trudeau was
Stephen Harper, someone who wasfond of calling Canada quote
(16:26):
unquote an emerging energysuperpower.
I'm talking back 2006 to 2015,when he left office.
At that time, there was a clearpush to position energy as a
national strength, and under theTrudeau government, that kind
of lost its steam.
We seemed to turn inward,things became more polarized,
(16:48):
and then suddenly, in March 2025, I get this email on a Sunday
from Tej Parikh, from you thatput energy superpower back on
the table.
And then, a few weeks afterthat, we're having a federal
election in Canada and there'sMark Carney talking about the
energy superpower that Canadacould be.
You're going to be able toclaim prescience in this, I
(17:10):
think.
Why do you think this phrasedisappeared and why do you think
it's coming back?
Tej Parikh (17:16):
Well, I mean, I think the association with crude
oil is one factor here.
I mean, so you can be rich inoil and natural gas.
But obviously over the last 10,15 years the global economy has
been thinking aboutalternatives and that's, you
(17:36):
know, in law in Europe and inthe UK and in some states in the
US, there's a concerted effortto shift to cleaner energy
sources.
And I think you know maybepeople thought, ok, well, canada
doesn't have that.
But you know, in my digging youbegin to see that Canada has
vast access to the criticalminerals that underpin a lot of
(18:01):
renewable energy sources.
And then you can go furtherthan that.
I mean the access to uranium rawmaterial as well in Canada,
which again is coming back onthe agenda, for well, it's
trying to come back on theagenda.
For European countries itremains a political challenge.
(18:22):
But nuclear energy, andbecoming a nuclear energy
superpower as well, highlightsthat it's.
You know this isn't just abouthaving access to those, you know
, old world energy sources.
This is access to the type ofenergy sources that the world is
looking for.
So Canada is aligned to therenewable transition and I was
(18:46):
quite surprised, actually, thatin the last 10 to 15 years you
haven't really heard Canada'sname in that.
With the US and Europe inparticular, trying to diversify
its supply chain from China,which dominates the green
industry from right the way fromthe raw material to processing
(19:10):
refining stages.
I thought it was about timethat Canada plays that up a bit
more and the opportunities ithas there.
Stewart Muir (19:16):
Yeah, I think there's a lot of people in
Canada who want to find out whatwe need to do, because there's
a sense here that, hey, we'vedone all the right things.
There were pressures becausewe're an open, democratic
society.
If you have a beef, you can airit.
You can even pressure it intoregulatory processes,
legislation, regulation.
You can freely speak what youbelieve to the public and voters
(19:42):
can weigh arguments.
All of that is completely openand free.
We're one of the freestcountries in the world, I think,
by any measure, and is it thatfreedom itself which has caused
us to accomplish this state,where now the world has
forgotten about us because wehave maybe handcuffed ourselves
with some of the regulationswe've got?
Tej Parikh (20:10):
Sure, I mean, this is pretty much a narrative that
happens around the world and itis a difficulty.
But I think where thediscussion needs to go is is
there is an opportunity here.
How can we take advantage ofthis opportunity in a way that
is as sustainable and inclusiveas possible?
And people are answering thesequestions.
You know, this isn't about justdigging up Canada and
(20:32):
exploiting its raw materials.
It's about finding ways inwhich you can create economic
compacts with indigenouscommunities.
Create economic compacts withindigenous communities it's a
way in which you can, you know,sustainably mine parts of the
country and ensure that, as youare developing underground
resources in canada, you arealso developing local economies.
(20:54):
So developing an industry meansyou develop jobs.
You develop entire clusterindustries that join to this.
This isn't just about creatingmore mining jobs.
Once you start developingfactories and industries in
certain areas and then other,you know, financial services,
(21:16):
commercial roles, all of thesethings build up, and that's how
I think the debate needs to bekind of pushed forward a little
bit made here in the UK when, inthe 1970s, a lot of the
(21:45):
revenues that we were able togenerate from oil in the North
Sea didn't really go back in tothe economy it wasn't saved in
any way that could thenessentially become a sustainable
source of revenue.
And I think there are veryclever ways in which Canada and
all Canadians can see thatactually these natural resources
(22:07):
that the country has isactually an asset that everyone
has a share in.
And you know, towards the end ofthe piece I did kind of raise
this question of whether thereare clever funding vehicles,
whether it's a sovereign wealthfund or more interesting ways in
which, you know, maybe pensionfunds or asset managers can get
involved in supporting thefinancing, where everyone can
(22:29):
have a stake in the success ofCanada's raw materials and its
natural resources.
And then I think, once you startdeveloping finance around these
industries, you can also findways to make these industries
even more sustainable andenvironmentally friendly.
And part of the reason whywe're stuck in this situation
where we're saying actually wedon't want to start mining a
(22:52):
resource because it's toopolluting or it's too dangerous,
is because we haven't reallyundergone the process of
actually working out.
There are technologies tomitigate some of those risks,
but if we don't really undergonethe process of actually working
out, there are technologies tomitigate some of those risks,
but if we don't embark on thisprocess we do not benefit from
you know the economic advantagesof it in the first place, and
then, secondly, we don'tactually develop the knowledge
(23:14):
that comes from actuallystarting on that journey.
So I think that's the way I lookat it.
Stewart Muir (23:20):
You kind of referenced the Norwegian model,
where they do have that.
Is it a trillion dollar plussovereign wealth fund, Exactly?
Yeah, that has become a story.
Everyone loves to hear aboutNorway's riches from oil and
they're able to talk about thegreen programs.
They've got very affordableelectric vehicles, things like
that.
Very affordable electricvehicles, things like that.
Do you think that would workfor Canada?
(23:41):
I?
Tej Parikh (23:43):
mean it certainly has the resources.
I mean Norway is on perhaps adifferent level, but I think I
mean one thing that was veryinteresting in looking at Canada
is actually one of itsadvantages in terms of financial
services is in pension assetmanagement.
(24:03):
The UK and Europe in particularlook to Canada, to how it
manages its pension wealtheffectively, and so there
clearly is a crossover in Canadaabout how well it can channel
its revenues from resources intolucrative and productive
investments, but also, onceCanada is able to generate
(24:26):
revenue from its resources, andwhether it kind of channels that
towards a sovereign wealth fund.
It then opens up theseincredible questions around what
industries, what infrastructureCanada wants to develop.
At the same time and I thinkthat's the point where you start
to see everyone in Canadabenefiting from these types of
(24:48):
resource opportunities.
I think that the problem iswhen you have a resource where a
lot of people, particularlylocal economies, do not benefit
from it, and then that createsanimosity, it creates the
politics.
That basically means theseeconomic opportunities will not
be, will not have the support inthe future, and I think that's
(25:12):
why I think it is a good modelfor Canada, and it'd be
interesting to see think tanksin Canada.
Work up how this might work.
Stewart Muir (25:21):
I noticed one comment under your post.
Canada is basically a bigCalifornia.
It's too difficult to getthings built here.
Tej Parikh (25:31):
Fair assessment, yeah I mean, I did read in my
research about permittingdifficulties and various
regulations and how that variesbetween different provinces.
I think one of the mostsurprising things for anyone who
is just new to canada is theparadox that it is, you know,
(25:55):
one of the most underpopulatedlarge countries and it has the
largest land mass and yet it hasa housing crisis and it has so
much land to build houses on.
A lot of advanced economies isgoing through this problem, but
you would have think you wouldhave thought a country with the
land mass of of canada wouldn'thave this problem, but it but it
(26:17):
clearly does.
And I it was quite surprisingto see how um vocal and you know
pointed a lot of the commentswere on this.
Um, you know, building has beena challenge.
It's not just the regulation.
A lot of advanced economieshave actually also faced
difficulties and just having thethe construction knowledge and
(26:41):
talent available to build incertain cases, and the know-how
is also a difficulty as well asthe regulations.
Stewart Muir (26:53):
It's a paradox and in recent years the federal
government, probably mindful ofthe first point that you made,
the three factors for resourcesuccess you need people.
People need to have skills todo those jobs.
Recognizing that, I think,policymakers in Ottawa said
bring the people.
They increased fourfold ormaybe more the number of new
(27:17):
Canadians.
There's been a surge, a floodof newcomers to Canada who've
brought new perspectives andskills.
It's become politicized.
Some are saying well, did youbring the right people to Canada
who have the skills we needright now to do these things?
And it affected, I think, someof the electoral outcomes
recently.
But we've got all these peoplebut we're not able to house them
(27:40):
and it's not even clear whetherwe're able to employ them as
well as they ought to beemployed.
We're bringing very highlyeducated people in a lot of
cases to the country.
How does this fit together intowhat we're talking about here,
tej?
Tej Parikh (27:54):
Yeah.
I mean this isn't just achallenge in Canada.
I mean, you know, a lot ofpeople did look to the Trudeau
government and say, look, here'sa good, good example of a
country who is, you know, notonly taking a responsible
approach to taking in vulnerablecommunities, but also realizing
(28:15):
that immigration is central tosupporting economic growth.
Now, the problem is for all ofus who believe in immigration
and the importance of havingdiversity and importance of
boosting our labor forces, isthat you can't win the argument
(28:39):
unless the infrastructure andthe public services also grows
at the same rate.
And in Canada, you know, thishas inherently been part of the
reason why house prices haveboomed so much, but also the
tensions in the politics isn'tjust down to what happens with,
you know, house prices in themarket, but it's also about
(29:00):
access to public services.
You know, if localities receivea lot of individuals, then we
need to be able to map howindividuals then have access to
public services.
And I think a lot of countriesreally have difficulty with this
.
And it's those day-to-daythings that then create the
(29:36):
strains, or the politicalstrains around immigration,
particular because, as I said,the standard of living in Canada
not accounting for the high,you know, rental costs or the
high costs of actually kind ofhaving shelter in Canada, but a
lot of people want to live there.
A lot of people want to live inVancouver, a lot of people want
to go to Toronto.
(29:56):
They like the way Canadianslive in the lifestyle, and so
attracting the high-end workersis not a problem in terms of
lower skilled workers.
There are the skill sets therethat every country needs, and if
Canada wants to develop,particularly if it needs
construction workers, if itneeds people to work in the
(30:16):
manufacturing sector or thesectors that are more kind of
aligned to the natural resourcesand this is a key resource that
Canada will need as well.
We know that it isunderpopulated and you know
labor is going to play a big,big part in supporting its
growth.
But the challenge and thechallenge for any politician and
(30:37):
policymaker is immigration canonly be a success if you you you
know also ensure that theinfrastructure, both the public
infrastructure, public serviceinfrastructure, road, rail and
housing also evolve at the sametime.
And I think you know there's afew things.
When you look at Canada and diginto the data, you see how,
(30:59):
particularly over the last fiveto 10 years, there's been a
mismatch there and,unfortunately, when that
mismatch arises, you have apolitical backlash and it
becomes very difficult for thepolitics to then shift again.
So it's about getting thatright in the future.
Stewart Muir (31:16):
Tej, a little earlier in your career you were
an economist at the Bank ofEngland and you arrived not long
after Mark Carney departed fromhis role as governor.
You arrived at the FinancialTimes a few years back, not long
after the departure of ChrystiaFreeland, who went on to become
the finance minister, currentlythe transportation minister.
(31:38):
I guess you have heard aboutsome of these interesting
Canadians.
What do you make of Canadiansfrom that kind of experience and
other experience?
What is the Canadian thing?
The people and outlook.
Tej Parikh (31:51):
I mean there is the kind of the typical
characteristic Everyone knowsCanadians as being incredibly
kind and caring individuals.
I think with Mark Carney he didtransform the Bank of England, I
should say.
I mean, I was there around 2014when he came in and he was known
(32:13):
for his charisma and being afresh, modern voice in the
institution and don't forget,this is a 100 years plus old
institution and he helped tokind of energize the place and
bring about his own changes, notonly from his experience in
finance, but also just his kindof modernizing the way the
(32:38):
institution thought abouteconomics and financial markets
I thought was quite notable inmy time there.
I actually bumped into Mark.
The first time I bumped intohim in the Bank of England
office was actually when he wasgetting a tour of the gym
actually, so that was the firsttime I bumped into him.
I know he likes to keep inshape and keep fit, so that was
(33:02):
a good old memory of mine.
I think particularly Europeansand in the UK have a very
positive view of Canadians and Ithink Mark Clarnie is going to
be an incredibly strong voiceand somebody who I think Brits
generally have a strong view of.
Stewart Muir (33:24):
As he moves into hosting the G7, he'll be
possibly the newest electedleader of the countries on the
stage there, but certainly notthe least experienced, given all
that's happened since the G7last met.
What do you think the dynamicis?
How does that all unfold?
And I don't mean just forCanada the bigger discussion but
(33:47):
also how does Mark Carney fitinto this, given the pretty
incredible career he's had infinance?
Tej Parikh (33:54):
Yeah, I mean he will be a highly respected voice in
that.
I mean, if you look at hiscareer, you know, going from the
financial crisis, from his fromearlier parts of his career in
2008, 2009 he was also in the ukat a at a pretty tumultuous
time for the uk economy, both interms of politics, being
(34:22):
finance, with experience of thepolitics and what's involved in
getting the right stakeholderstogether to come to a solution.
So I think he will play astrong part in that.
We were looking at the campaignI suppose the campaigning
period where there were concernsabout whoever was leading
(34:47):
Canada, how their relationshipswould be with Donald Trump, and
I think you know from what wesaw in the visit in the Oval
Office whenever it was.
You know Mark clearly has builta rapport.
I think it's important to builda rapport, obviously, with the
US it's a major economy and inorder to negotiate with Donald
(35:10):
Trump and to ensure that the USis also it is a major
stakeholder obviously inanything that the G7 does and
its decisions.
I think that relationship iscrucial Because in order for the
G7 to be a constructive bodyover the next three to four
years or as long as the Trumpterm is in place.
(35:33):
You're going to need somebodywho can speak with Trump,
negotiate with Trump, andtherefore, I think you know Mark
Carney is going to play animportant role in that.
Stewart Muir (35:46):
Where have you landed on what Trump is all
about?
I mean, is this a poker game?
Is it a chess match?
Is it a street fight?
Is I mean?
I think he likes making deals.
Tej Parikh (36:09):
He likes negotiating and I think, from what we can
understand from his tariffpolicy, he takes things to
extremes and then he rows thingsback and he tries to gain
concessions where he can.
And I think he will take thesame approach on most policy he
has.
I mean, he sees the worldthrough a transactional lens.
(36:33):
It's what can the other peopleoffer me and how can we do a
deal to ensure that I can gainthat?
And I think in some sense youknow, yes, he is unpredictable,
above and beyond that.
But I think if you know thatthat's his framing, then I think
it means that you know othersjust need to adjust to it and be
(36:56):
pragmatic in it.
And that is essentially what wehave seen from the way the
Canadian Prime Minister has beeninteracting with Donald Trump.
You have to be pragmatic if youknow what the threat could be.
Europeans are also going tolearn that when they try to
negotiate with Trump.
So I mean a lot of optimism hassomehow come out of the last
(37:18):
couple of weeks, given that theUS has unwound some parts of its
tariff agenda.
But I would kind of cautionagainst that.
You know, not only is Trump anegotiator, he does like to
wield the uncertainty card.
So you know, for the US asallies, for Canada, for Europe,
(37:39):
it's just about trying to makesure you stay on the right side
and trying to also integrateamongst yourselves.
You know Canada should look todo trade deals with Europe and
Europe.
Obviously.
We saw recently the UK and theEU doing a trade deal as well.
These are opportunities tostrengthen those ties.
Stewart Muir (37:58):
I haven't brought up China here.
China here, it could reallyconsume a lot of time, but maybe
just in terms of energy andnatural resources and the
transformation of the economy,the almost monopolization of the
supply chain of a huge numberof the elements and metals and
manufactured products necessaryfor decarbonization.
(38:20):
How is that unfolding in termsof power politics?
And I'm sure it'll be on theagenda the G7.
And also, where does Canada fitin?
Is it critically important thatCanada is a strong and
recognized supplier of thingsthat shouldn't maybe just come
from one place in the world?
Tej Parikh (38:38):
Yes, I mean China has been ahead of the West on
critical minerals, you know itat least has a, you know, a few
decades head start here.
China has been thinking aboutthis for a long time and it's
been nurturing not only its owninternal resources but also its
resources within other countries, whether that's in Africa or
(39:00):
South America, and it's beendeveloping those supply chains,
countries, whether that's inAfrica or South America, and has
been developing those supplychains.
And over the last 20, 30 years,china's not only, as I said,
developed a monopoly on the kindof the mining of resources, but
also the technology in terms ofprocessing and refining.
And if you just look at thecritical minerals that the world
needs in terms of the greentransition, it's difficult to
(39:21):
see a point where any othercountry has a foothold.
Now we've seen what the dangersare from, not just from a
geopolitical perspective, butsupply chains can be at risk
even without the geopolitics, aswe saw during the pandemic.
So Canada's role and the factthat Canada has deposits of
(39:41):
these resources not only does ithave the deposits, but also,
when it can specialize in theseum, in raw materials, it also
has the expertise it can play avery important role in providing
diversification in supplychains and particularly in for a
lot of countries in the westernbloc who want to try and reduce
(40:04):
some of their supply chaindependencies or their risks that
they associate with China, thenit makes Canada an even more
important player within that,particularly between the EU and
Canada and UK and UK.
Stewart Muir (40:20):
Tej, I know you're a big reader because I read
your reviews in the FinancialTimes.
I wish I had some of the bookson my bookshelf that you've been
reading lately Power andProgress, innovation for the
Masses, any Happy Returns, theWar Below Any book.
You'd really recommend one ofthose, or maybe something else
that you're reading right nowthat is a must read for 2025?
(40:43):
.
Tej Parikh (40:44):
Well, it's actually not one for 2025, but the
Prisoners of Geography series isan excellent book because it
kind of gets to what wediscussed right at the start of
the podcast, which is Canada'sinnate economic advantages and
understanding how geographyplays a key, determining role in
(41:09):
your economic and even yoursocietal progress.
And so that's kind of where Iinitially got this inspiration
to look at Canada, because I wastaking a lot of the lessons
from prisoners of geography torealise, ok, geography is a big
part that explains how countriesprogress and develop.
(41:30):
I mean, the UK is a tiny islandand just off Europe, it had to
develop this outwardness andopenness to discovery and that's
kind of how the country emerged.
And then, if you look at Canada, that's where the question
marks came.
So you know why is it not evenmore kind of dominant than it is
?
So I would kind of say that's agood book to be reading.
Stewart Muir (41:53):
Sounds like proper grounding.
Now suppose the phone rang, tej, and Mark Carney your former
colleague from the gym as wellsaid I need to know how I'm
going to make Canada asuperpower and realize its
potential.
Loved your piece a few monthsago, tej, but I need your advice
.
What should I do in the nextcouple of years to make Canada
(42:17):
an energy superpower?
Tej Parikh (42:19):
Yeah, well, I'm sure he's already got his own 10
point plan for this.
I mean, I think the first thingis he should build on the
momentum that he has, thepolitical momentum he has on
reducing internal trade businessin Canada.
You then create the groundworkin order to start taking
(42:47):
advantage of the mineralresources and the natural
resources.
So I think that's the firststage just creating a better
business environment for Canadathrough those internal trade
barriers and then, secondly,thinking about how Canada can
start to share in the revenuesfrom these industries.
You know, once people start towell, canadians start to feel
(43:11):
that everyone is benefiting fromthe natural resources in the
country and there are avenues torecycle the revenues from those
sectors into the country,whether that's through housing
or developing infrastructure,improving public services.
You then have this kind ofreinforcement effect between the
country and its naturalresources and its assets and the
(43:33):
development of peoples, and Ithink working on that will kind
of provide the groundwork forCanada's emergence Sounds like
solid advice and I hope he hearsabout it and takes it, because
we do need to get things going.
Stewart Muir (43:52):
That's the consensus of probably more than
80% of voters in Canada thatthere is that frustration.
But look, tej Parikh, speakingto us from the Financial Times
in London, really appreciateyour time and your thoughts and
the thoughtfulness that you'vegiven to the subject of Canada.
I've spent a little time innewsrooms in London.
I know you can clear a meetingroom if you say I've got a great
(44:13):
story on Canada, but you'vedone it for us.
You've got that story in theprint and you've put so much
passion into the storytellingand the graphics.
I just love that piece and it'sbeen an absolute pleasure to
spend this time with you.
So thank you very much.
Thank you very much for havingme, thanks for joining us on
(44:35):
Power Struggle.
Until next time, keep thinkingabout where Canada's headed.
It's going to be quite a ride.
Give us a like, share and talkabout us.
Thank you.
This started from amusing, really, just looking at
the global map and realizinghold on, you know, canada is
absolutely enormous.
It's a G7 nation and yet why dowe not hear about Canada when
we talk about global superpowers?
And then, as you dig deeper,you realize OK, so Canada's
second largest country bylandmass has the longest
(00:22):
coastline.
Country by landmass has thelongest coastline.
And then when you look intowhat it has on the ground in
terms of its mineral resourcesand then the energy resources in
terms of oil and natural gasthe more traditional raw
materials for energy today youbegin to build up this picture
that you know there's anenormous economic potential here
, very much the same geographicadvantages that have underpinned
(00:45):
America's economic emergenceover the last 100 years Having a
very strong coastline both onthe Pacific coast and the
Atlantic.
Given everything we understandabout the advantages that
countries need to grow, why isCanada not doing better
economically?
Stewart Muir (01:13):
If you're enjoying Power Struggle, make sure to
subscribe, share this episodeand leave us a review.
It helps us keep fact-basedenergy conversations going and
gets these voices into more ears.
Canada, as the host of the 2025G7 Summit in Kananaskis, stands
at a pivotal moment.
The promise of Prime MinisterMark Carney turning Canada into
(01:39):
an economic and energysuperpower is bold, intriguing
and perhaps challenging Toexplore whether Canada is truly
ready to seize this ambitiousgoal today.
I'm delighted to welcome ourguest.
Tej Parikh is the FinancialTimes' economics editorial
writer.
He also writes the Sundayversion of the Free Lunch
newsletter, which I love to getin my email.
It covers the global economicpolicy debate.
(02:02):
Before joining the FinancialTimes, the FT, he was a director
of economics at the FitchRatings Company and chief
economist at the Institute ofDirectors, and he was previously
an economist at the Bank ofEngland.
Tej has also written fornumerous international outlets
on issues covering globalaffairs and public policy, and
(02:23):
he was once a journalist for theCambodia Daily in Phnom Penh.
Welcome, tej, thank you.
Thank you for having me.
Great to see you.
You wrote a piece recently allabout Canada.
It was just so informative and,in a funny way, it made the
topics you covered much moresignificant to readers in Canada
because it came from an outsidesource.
(02:45):
So, tej, what has Canada gotthat would make it a superpower,
do you think, in terms ofnatural resources?
Tej Parikh (02:53):
Yeah, well, I mean, this started from amusing,
really, just looking at theglobal map and realizing, hold
on, Canada is absolutelyenormous.
Realising hold on, you know,canada is absolutely enormous.
It's a G7 nation and yet why dowe not hear about Canada when we
talk about global superpowers?
So then I thought initially thiscould form a very interesting
(03:16):
column idea, just to explore.
And then as you dig deeper yourealise, okay, so Canada is, you
know, second largest country bylandmass, has the longest
coastline, and then when youlook into what it has on the
ground in terms of its mineralresources, the vast critical
mineral resources it has, andthen the energy resources in
(03:37):
terms of oil and natural gas,which are kind of the more
traditional raw materials forenergy today, which are kind of
the more traditional rawmaterials for energy today, you
begin to build up this picturethat you know there's an
enormous economic potential here.
And then you just throw in thefact that geographically, you
have essentially very much thesame geographic advantages that
(04:00):
have underpinned America'seconomic emergence over the last
100 years, and that's, you know, having a very strong coastline
both on the Pacific coast andthe Atlantic.
So all of these kind ofadvantages, I felt really played
(04:21):
into this question.
You know why is Canada notdoing better economically than
we might expect, giveneverything we understand about
the advantages that countriesneed?
Stewart Muir (04:35):
to grow.
Well, you've hit on somethingimportant.
I think that's what resonatedand I believe I shared that in
my social media.
A lot of people were suddenlytalking about it and you know
your external position.
But I think the fact that youcovered so much ground in that
you talked about the differentmetals and minerals, you talked
about the potash that goes tothe US and grows a lot of their
(04:57):
food, and you had a wonderfulmap that I shared in LinkedIn
and everyone was talking aboutthat.
Your colleagues did a great jobat the FT.
But then your newsletter piecewas just full of relevant charts
and graphs and in the YouTubeversion of this we'll share a
few of the visuals so people cansee.
But I must say congrats ondoing a really thorough piece.
(05:21):
I've rarely seen that done.
I was kind of envious because Ihey, I like to tell the
resource story.
I was kind of envious because Ihey, I like to tell the
resource story.
It's part of what I do inCanada here.
Tej Parikh (05:29):
I was personally quite surprised by how viral
that went in Canada and I thinka lot of the conversations or
the responses I got back fromCanadians was it was actually
quite split.
If I'm honest with you, therewere a lot of people with a very
similar view to you, being veryoptimistic that you know
(05:50):
somebody from Europe has, youknow, spotted all these
advantages and is telling thestory of the country and the
potential of the country.
But I think obviously when youtalk about natural resources,
when you're talking about energy, there is obviously a tension
there.
Environmentalists in particularand those who are wanting to
(06:10):
protect the indigenous rights ofindigenous communities in
Canada are obviously concerned.
So there was a bit of a splitresponse in the two and I think
one thing that I wasn't tryingto imply was that you know, look
, here's a country with tons ofresources that we just need to
plunder.
My kind of point was more thathere's a country that has a
(06:36):
number of resources that canprovide a focal point for its
development and its emergence,and let's not forget that the
world is trying to make thistransition to the green economy.
So this doesn't have to beabout being anti-environmental.
It's about creating thosesupply chains and critical
minerals that the Western worldis currently, you know, short of
(06:58):
.
Stewart Muir (06:59):
I felt your piece struck exactly the right tone in
that, because you weren'tadvocating, you were reporting,
but I think it did come aroundto that.
And one of the intriguingthings and you've referenced
this is the potential.
I mean you argue that Canada,with this geography, its
placement and resources, itcould spark an economic boom.
But why hasn't it?
And I know the Financial Timesis a companion publication to
(07:23):
the Economist and the Economistrecently wrote that if Canada
was a US state, it would beAlabama in economic terms, which
no one thinks is a compliment,although Alabama is a wonderful
place.
I mean, how do we go fromAlabama to superpower?
Are we over-optimistic?
Tej Parikh (07:40):
So when you break it down and you look at why income
per capita in Canada hasperhaps not increased as fast as
we might expect on the basis ofthose advantages, it really
kind of breaks down to threecomponents.
(08:01):
I mean one is investment, sohow much capital goes into the
country.
The second is labor, and notjust the amount, the size of the
workforce you have, but howwell you utilize the workforce.
And then the third component issomething that economists like
to call a total factorproductivity, which is
(08:23):
essentially your innovativeability and your ability to
bring together capital andpeople.
And when you look at Canada asopposed to other large economies
although this is a challengefor a lot of large economies is
its ability to integrate all itsresources together.
So can different provincestrade effectively?
(08:45):
Can workers move from oneprovince to find a job in
another?
And when you begin to see thatactually there are a lot of
restrictions in Canada, not justbecause of its vast geography
but because of regulation, thatit actually can't combine its
capital and labour asproductively as it could you
know these internal tradebarriers in Canada it became
(09:08):
quite a central piece of theanalysis for me.
And, you know, I think thoseare the three key reasons,
really, why Canada hasn't reallygrown as fast as it could have.
Stewart Muir (09:20):
Well, this is the time to be talking about these
things.
You know, in Canada itsometimes feels like there's a
cringe that we have urbanresidents, especially that we've
got all these great things thatexist here.
But wouldn't it be better if wewere Silicon Valley or
(09:43):
Switzerland and produced nicewatches or something that was a
little more glam?
Yet I can't think of one thingthat the world does anywhere
that doesn't depend on materialinputs of some kind or energy
products.
It could be hard to see, butthey're there.
Is there a mythology that theworld sees about Canada that we
should be uneasy about thatwe're these kind of lumberjack
(10:07):
types hewers of wood and haulersof water, and that, yeah, we're
kind of primitive as an economyand that's something to be
ashamed of.
Is that a real thing that isseen outside?
Tej Parikh (10:21):
I don't think so.
I don't think so.
(10:52):
I mean in that way.
If anything, what I would saywith canada is I mean, most of
the western worlds, you know us,europe included has kind of got
into the function of doingthese high-tech service industry
.
You know the sexier type ofjobs at home and then importing
(11:14):
raw materials from China orIndia or you know parts of Asia.
Now, what we clearly know fromthe last five years of looking
at geopolitics and economics isthat being over-reliant on
particular supply chains isn'tthe best thing, but also not
having those competencies athome is also a difficulty.
(11:35):
So if you don't have people whowork in manufacturing or
construction, you lose theability to have an agile economy
.
So I think in Canada thatdiversity is its strength, if
anything, and I think, given ithas these vast raw material
resources, there is a massivescope for it to become even more
(11:58):
integrated into Western supplychains in particular and to
become a supplier of thesethings.
Stewart Muir (12:03):
I'm in Western Canada, here, tejan, we had a
deal announced last week by oneof the big midstream energy
companies, a company calledEnbridge, that they have done a
deal with more than 30 FirstNations for that that syndicate
to purchase a large piece of agas transportation network
including pipelines, and thatwas, I'm going to say, one of,
(12:26):
if not the most significantFirst Nations deal in oil and
gas infrastructure.
We've seen some big deals inhydro in Quebec and other in
Ontario as well, but one of thebiggest and this will empower a
generation of uplift for theFirst Nations involved.
In the view of those FirstNations, they voluntarily came
into this, so I mean that's agood news story.
(12:48):
Is there something that wecould be doing differently in
Canada to get that story out?
Is there a way to be morecompelling about information we
think is valid, aboutinformation we think is valid?
Tej Parikh (12:58):
Well, I mean, I wouldn't be taking marketing
advice from a Brit.
We're not the best at marketingthe UK, we're notoriously quite
downbeat and I think, actuallyoddly, what I would say is, over
the last you know, four to sixmonths.
You know it's a weird offshootof Donald Trump's return to the
(13:19):
White House, but you know,canada has been thrust into the
spotlight.
I also think the new PrimeMinister, mark Carney, is a good
leader on the world stage and Ithink that will also kind of
raise Canada's stature and heseems to be talking about the
right things in terms of theseopportunities.
You know, dovetailing quitewell with some of the points I
(13:41):
made actually in my articleabout what the opportunities
Canada can do and the potentialit has.
I think one of the things thatis a bit of a crossover with the
UK and perhaps other countriesdo this better is for the
foreign direct investor who isthinking about setting up in
(14:03):
another country.
You know how easy is it forthem to know what opportunities
are available in Canada and godown to the province level and
then also understand okay, if Idid want to invest in a certain
project in this province, whatare the regulations, what are
the tax requirements?
(14:23):
What if I want to then sellinto another province?
You know these are the types ofquestions.
I think it's the real the, thedetail that kind of gets the
invest.
The investors right now willknow that Canada has all of this
latent potential, they willknow that there is resources
there, they will know that thereis talented workers in Canada.
(14:47):
But it's just the answers towhat barriers there are to
business and how they can bereduced, and I think that's the
piece that Canada and itsprovinces can do a better job on
, and it already is.
I think what's been verypositive and I think it's been
picked up here is the discussionaround internal trade barriers
(15:12):
in Canada between provinces.
Now, the reason why this is soprominent in the minds of
European investors in particularis that the European Union is,
you know, effectively it's aneconomic union, but it's split
among 27 member states withvarious different regulations
and been trying to find ways toharmonise and improve that for
(15:36):
investors, and investors hereconstantly make this point that
I don't have access to this hugemarket if everyone's got
various different regulations,and I think that's the.
That's the thing that I thinkcanada would benefit from
showing how it is a kind of amore unified country and showing
(15:56):
how that it is a unifiedmarketplace where investors and
businesses can develop expansivesupply chains.
Stewart Muir (16:06):
If Europe can do it, canada should be able to,
and it's been a big talkingpoint in business and government
circles lately to do that.
So hopefully the resolvebrought about by this current
crisis will turn into something.
Look, taj, our prime ministerbefore Justin Trudeau was
Stephen Harper, someone who wasfond of calling Canada quote
(16:26):
unquote an emerging energysuperpower.
I'm talking back 2006 to 2015,when he left office.
At that time, there was a clearpush to position energy as a
national strength, and under theTrudeau government, that kind
of lost its steam.
We seemed to turn inward,things became more polarized,
(16:48):
and then suddenly, in March 2025, I get this email on a Sunday
from Tej Parikh, from you thatput energy superpower back on
the table.
And then, a few weeks afterthat, we're having a federal
election in Canada and there'sMark Carney talking about the
energy superpower that Canadacould be.
You're going to be able toclaim prescience in this, I
(17:10):
think.
Why do you think this phrasedisappeared and why do you think
it's coming back?
Tej Parikh (17:16):
Well, I mean, I think the association with crude
oil is one factor here.
I mean, so you can be rich inoil and natural gas.
But obviously over the last 10,15 years the global economy has
been thinking aboutalternatives and that's, you
(17:36):
know, in law in Europe and inthe UK and in some states in the
US, there's a concerted effortto shift to cleaner energy
sources.
And I think you know maybepeople thought, ok, well, canada
doesn't have that.
But you know, in my digging youbegin to see that Canada has
vast access to the criticalminerals that underpin a lot of
(18:01):
renewable energy sources.
And then you can go furtherthan that.
I mean the access to uranium rawmaterial as well in Canada,
which again is coming back onthe agenda, for well, it's
trying to come back on theagenda.
For European countries itremains a political challenge.
(18:22):
But nuclear energy, andbecoming a nuclear energy
superpower as well, highlightsthat it's.
You know this isn't just abouthaving access to those, you know
, old world energy sources.
This is access to the type ofenergy sources that the world is
looking for.
So Canada is aligned to therenewable transition and I was
(18:46):
quite surprised, actually, thatin the last 10 to 15 years you
haven't really heard Canada'sname in that.
With the US and Europe inparticular, trying to diversify
its supply chain from China,which dominates the green
industry from right the way fromthe raw material to processing
(19:10):
refining stages.
I thought it was about timethat Canada plays that up a bit
more and the opportunities ithas there.
Stewart Muir (19:16):
Yeah, I think there's a lot of people in
Canada who want to find out whatwe need to do, because there's
a sense here that, hey, we'vedone all the right things.
There were pressures becausewe're an open, democratic
society.
If you have a beef, you can airit.
You can even pressure it intoregulatory processes,
legislation, regulation.
You can freely speak what youbelieve to the public and voters
(19:42):
can weigh arguments.
All of that is completely openand free.
We're one of the freestcountries in the world, I think,
by any measure, and is it thatfreedom itself which has caused
us to accomplish this state,where now the world has
forgotten about us because wehave maybe handcuffed ourselves
with some of the regulationswe've got?
Tej Parikh (20:10):
Sure, I mean, this is pretty much a narrative that
happens around the world and itis a difficulty.
But I think where thediscussion needs to go is is
there is an opportunity here.
How can we take advantage ofthis opportunity in a way that
is as sustainable and inclusiveas possible?
And people are answering thesequestions.
You know, this isn't about justdigging up Canada and
(20:32):
exploiting its raw materials.
It's about finding ways inwhich you can create economic
compacts with indigenouscommunities.
Create economic compacts withindigenous communities it's a
way in which you can, you know,sustainably mine parts of the
country and ensure that, as youare developing underground
resources in canada, you arealso developing local economies.
(20:54):
So developing an industry meansyou develop jobs.
You develop entire clusterindustries that join to this.
This isn't just about creatingmore mining jobs.
Once you start developingfactories and industries in
certain areas and then other,you know, financial services,
(21:16):
commercial roles, all of thesethings build up, and that's how
I think the debate needs to bekind of pushed forward a little
bit made here in the UK when, inthe 1970s, a lot of the
(21:45):
revenues that we were able togenerate from oil in the North
Sea didn't really go back in tothe economy it wasn't saved in
any way that could thenessentially become a sustainable
source of revenue.
And I think there are veryclever ways in which Canada and
all Canadians can see thatactually these natural resources
(22:07):
that the country has isactually an asset that everyone
has a share in.
And you know, towards the end ofthe piece I did kind of raise
this question of whether thereare clever funding vehicles,
whether it's a sovereign wealthfund or more interesting ways in
which, you know, maybe pensionfunds or asset managers can get
involved in supporting thefinancing, where everyone can
(22:29):
have a stake in the success ofCanada's raw materials and its
natural resources.
And then I think, once you startdeveloping finance around these
industries, you can also findways to make these industries
even more sustainable andenvironmentally friendly.
And part of the reason whywe're stuck in this situation
where we're saying actually wedon't want to start mining a
(22:52):
resource because it's toopolluting or it's too dangerous,
is because we haven't reallyundergone the process of
actually working out.
There are technologies tomitigate some of those risks,
but if we don't really undergonethe process of actually working
out, there are technologies tomitigate some of those risks,
but if we don't embark on thisprocess we do not benefit from
you know the economic advantagesof it in the first place, and
then, secondly, we don'tactually develop the knowledge
(23:14):
that comes from actuallystarting on that journey.
So I think that's the way I lookat it.
Stewart Muir (23:20):
You kind of referenced the Norwegian model,
where they do have that.
Is it a trillion dollar plussovereign wealth fund, Exactly?
Yeah, that has become a story.
Everyone loves to hear aboutNorway's riches from oil and
they're able to talk about thegreen programs.
They've got very affordableelectric vehicles, things like
that.
Very affordable electricvehicles, things like that.
Do you think that would workfor Canada?
(23:41):
I?
Tej Parikh (23:43):
mean it certainly has the resources.
I mean Norway is on perhaps adifferent level, but I think I
mean one thing that was veryinteresting in looking at Canada
is actually one of itsadvantages in terms of financial
services is in pension assetmanagement.
(24:03):
The UK and Europe in particularlook to Canada, to how it
manages its pension wealtheffectively, and so there
clearly is a crossover in Canadaabout how well it can channel
its revenues from resources intolucrative and productive
investments, but also, onceCanada is able to generate
(24:26):
revenue from its resources, andwhether it kind of channels that
towards a sovereign wealth fund.
It then opens up theseincredible questions around what
industries, what infrastructureCanada wants to develop.
At the same time and I thinkthat's the point where you start
to see everyone in Canadabenefiting from these types of
(24:48):
resource opportunities.
I think that the problem iswhen you have a resource where a
lot of people, particularlylocal economies, do not benefit
from it, and then that createsanimosity, it creates the
politics.
That basically means theseeconomic opportunities will not
be, will not have the support inthe future, and I think that's
(25:12):
why I think it is a good modelfor Canada, and it'd be
interesting to see think tanksin Canada.
Work up how this might work.
Stewart Muir (25:21):
I noticed one comment under your post.
Canada is basically a bigCalifornia.
It's too difficult to getthings built here.
Tej Parikh (25:31):
Fair assessment, yeah I mean, I did read in my
research about permittingdifficulties and various
regulations and how that variesbetween different provinces.
I think one of the mostsurprising things for anyone who
is just new to canada is theparadox that it is, you know,
(25:55):
one of the most underpopulatedlarge countries and it has the
largest land mass and yet it hasa housing crisis and it has so
much land to build houses on.
A lot of advanced economies isgoing through this problem, but
you would have think you wouldhave thought a country with the
land mass of of canada wouldn'thave this problem, but it but it
(26:17):
clearly does.
And I it was quite surprisingto see how um vocal and you know
pointed a lot of the commentswere on this.
Um, you know, building has beena challenge.
It's not just the regulation.
A lot of advanced economieshave actually also faced
difficulties and just having thethe construction knowledge and
(26:41):
talent available to build incertain cases, and the know-how
is also a difficulty as well asthe regulations.
Stewart Muir (26:53):
It's a paradox and in recent years the federal
government, probably mindful ofthe first point that you made,
the three factors for resourcesuccess you need people.
People need to have skills todo those jobs.
Recognizing that, I think,policymakers in Ottawa said
bring the people.
They increased fourfold ormaybe more the number of new
(27:17):
Canadians.
There's been a surge, a floodof newcomers to Canada who've
brought new perspectives andskills.
It's become politicized.
Some are saying well, did youbring the right people to Canada
who have the skills we needright now to do these things?
And it affected, I think, someof the electoral outcomes
recently.
But we've got all these peoplebut we're not able to house them
(27:40):
and it's not even clear whetherwe're able to employ them as
well as they ought to beemployed.
We're bringing very highlyeducated people in a lot of
cases to the country.
How does this fit together intowhat we're talking about here,
tej?
Tej Parikh (27:54):
Yeah.
I mean this isn't just achallenge in Canada.
I mean, you know, a lot ofpeople did look to the Trudeau
government and say, look, here'sa good, good example of a
country who is, you know, notonly taking a responsible
approach to taking in vulnerablecommunities, but also realizing
(28:15):
that immigration is central tosupporting economic growth.
Now, the problem is for all ofus who believe in immigration
and the importance of havingdiversity and importance of
boosting our labor forces, isthat you can't win the argument
(28:39):
unless the infrastructure andthe public services also grows
at the same rate.
And in Canada, you know, thishas inherently been part of the
reason why house prices haveboomed so much, but also the
tensions in the politics isn'tjust down to what happens with,
you know, house prices in themarket, but it's also about
(29:00):
access to public services.
You know, if localities receivea lot of individuals, then we
need to be able to map howindividuals then have access to
public services.
And I think a lot of countriesreally have difficulty with this
.
And it's those day-to-daythings that then create the
(29:36):
strains, or the politicalstrains around immigration,
particular because, as I said,the standard of living in Canada
not accounting for the high,you know, rental costs or the
high costs of actually kind ofhaving shelter in Canada, but a
lot of people want to live there.
A lot of people want to live inVancouver, a lot of people want
to go to Toronto.
(29:56):
They like the way Canadianslive in the lifestyle, and so
attracting the high-end workersis not a problem in terms of
lower skilled workers.
There are the skill sets therethat every country needs, and if
Canada wants to develop,particularly if it needs
construction workers, if itneeds people to work in the
(30:16):
manufacturing sector or thesectors that are more kind of
aligned to the natural resourcesand this is a key resource that
Canada will need as well.
We know that it isunderpopulated and you know
labor is going to play a big,big part in supporting its
growth.
But the challenge and thechallenge for any politician and
(30:37):
policymaker is immigration canonly be a success if you you you
know also ensure that theinfrastructure, both the public
infrastructure, public serviceinfrastructure, road, rail and
housing also evolve at the sametime.
And I think you know there's afew things.
When you look at Canada and diginto the data, you see how,
(30:59):
particularly over the last fiveto 10 years, there's been a
mismatch there and,unfortunately, when that
mismatch arises, you have apolitical backlash and it
becomes very difficult for thepolitics to then shift again.
So it's about getting thatright in the future.
Stewart Muir (31:16):
Tej, a little earlier in your career you were
an economist at the Bank ofEngland and you arrived not long
after Mark Carney departed fromhis role as governor.
You arrived at the FinancialTimes a few years back, not long
after the departure of ChrystiaFreeland, who went on to become
the finance minister, currentlythe transportation minister.
(31:38):
I guess you have heard aboutsome of these interesting
Canadians.
What do you make of Canadiansfrom that kind of experience and
other experience?
What is the Canadian thing?
The people and outlook.
Tej Parikh (31:51):
I mean there is the kind of the typical
characteristic Everyone knowsCanadians as being incredibly
kind and caring individuals.
I think with Mark Carney he didtransform the Bank of England, I
should say.
I mean, I was there around 2014when he came in and he was known
(32:13):
for his charisma and being afresh, modern voice in the
institution and don't forget,this is a 100 years plus old
institution and he helped tokind of energize the place and
bring about his own changes, notonly from his experience in
finance, but also just his kindof modernizing the way the
(32:38):
institution thought abouteconomics and financial markets
I thought was quite notable inmy time there.
I actually bumped into Mark.
The first time I bumped intohim in the Bank of England
office was actually when he wasgetting a tour of the gym
actually, so that was the firsttime I bumped into him.
I know he likes to keep inshape and keep fit, so that was
(33:02):
a good old memory of mine.
I think particularly Europeansand in the UK have a very
positive view of Canadians and Ithink Mark Clarnie is going to
be an incredibly strong voiceand somebody who I think Brits
generally have a strong view of.
Stewart Muir (33:24):
As he moves into hosting the G7, he'll be
possibly the newest electedleader of the countries on the
stage there, but certainly notthe least experienced, given all
that's happened since the G7last met.
What do you think the dynamicis?
How does that all unfold?
And I don't mean just forCanada the bigger discussion but
(33:47):
also how does Mark Carney fitinto this, given the pretty
incredible career he's had infinance?
Tej Parikh (33:54):
Yeah, I mean he will be a highly respected voice in
that.
I mean, if you look at hiscareer, you know, going from the
financial crisis, from his fromearlier parts of his career in
2008, 2009 he was also in the ukat a at a pretty tumultuous
time for the uk economy, both interms of politics, being
(34:22):
finance, with experience of thepolitics and what's involved in
getting the right stakeholderstogether to come to a solution.
So I think he will play astrong part in that.
We were looking at the campaignI suppose the campaigning
period where there were concernsabout whoever was leading
(34:47):
Canada, how their relationshipswould be with Donald Trump, and
I think you know from what wesaw in the visit in the Oval
Office whenever it was.
You know Mark clearly has builta rapport.
I think it's important to builda rapport, obviously, with the
US it's a major economy and inorder to negotiate with Donald
(35:10):
Trump and to ensure that the USis also it is a major
stakeholder obviously inanything that the G7 does and
its decisions.
I think that relationship iscrucial Because in order for the
G7 to be a constructive bodyover the next three to four
years or as long as the Trumpterm is in place.
(35:33):
You're going to need somebodywho can speak with Trump,
negotiate with Trump, andtherefore, I think you know Mark
Carney is going to play animportant role in that.
Stewart Muir (35:46):
Where have you landed on what Trump is all
about?
I mean, is this a poker game?
Is it a chess match?
Is it a street fight?
Is I mean?
I think he likes making deals.
Tej Parikh (36:09):
He likes negotiating and I think, from what we can
understand from his tariffpolicy, he takes things to
extremes and then he rows thingsback and he tries to gain
concessions where he can.
And I think he will take thesame approach on most policy he
has.
I mean, he sees the worldthrough a transactional lens.
(36:33):
It's what can the other peopleoffer me and how can we do a
deal to ensure that I can gainthat?
And I think in some sense youknow, yes, he is unpredictable,
above and beyond that.
But I think if you know thatthat's his framing, then I think
it means that you know othersjust need to adjust to it and be
(36:56):
pragmatic in it.
And that is essentially what wehave seen from the way the
Canadian Prime Minister has beeninteracting with Donald Trump.
You have to be pragmatic if youknow what the threat could be.
Europeans are also going tolearn that when they try to
negotiate with Trump.
So I mean a lot of optimism hassomehow come out of the last
(37:18):
couple of weeks, given that theUS has unwound some parts of its
tariff agenda.
But I would kind of cautionagainst that.
You know, not only is Trump anegotiator, he does like to
wield the uncertainty card.
So you know, for the US asallies, for Canada, for Europe,
(37:39):
it's just about trying to makesure you stay on the right side
and trying to also integrateamongst yourselves.
You know Canada should look todo trade deals with Europe and
Europe.
Obviously.
We saw recently the UK and theEU doing a trade deal as well.
These are opportunities tostrengthen those ties.
Stewart Muir (37:58):
I haven't brought up China here.
China here, it could reallyconsume a lot of time, but maybe
just in terms of energy andnatural resources and the
transformation of the economy,the almost monopolization of the
supply chain of a huge numberof the elements and metals and
manufactured products necessaryfor decarbonization.
(38:20):
How is that unfolding in termsof power politics?
And I'm sure it'll be on theagenda the G7.
And also, where does Canada fitin?
Is it critically important thatCanada is a strong and
recognized supplier of thingsthat shouldn't maybe just come
from one place in the world?
Tej Parikh (38:38):
Yes, I mean China has been ahead of the West on
critical minerals, you know itat least has a, you know, a few
decades head start here.
China has been thinking aboutthis for a long time and it's
been nurturing not only its owninternal resources but also its
resources within other countries, whether that's in Africa or
(39:00):
South America, and it's beendeveloping those supply chains,
countries, whether that's inAfrica or South America, and has
been developing those supplychains.
And over the last 20, 30 years,china's not only, as I said,
developed a monopoly on the kindof the mining of resources, but
also the technology in terms ofprocessing and refining.
And if you just look at thecritical minerals that the world
needs in terms of the greentransition, it's difficult to
(39:21):
see a point where any othercountry has a foothold.
Now we've seen what the dangersare from, not just from a
geopolitical perspective, butsupply chains can be at risk
even without the geopolitics, aswe saw during the pandemic.
So Canada's role and the factthat Canada has deposits of
(39:41):
these resources not only does ithave the deposits, but also,
when it can specialize in theseum, in raw materials, it also
has the expertise it can play avery important role in providing
diversification in supplychains and particularly in for a
lot of countries in the westernbloc who want to try and reduce
(40:04):
some of their supply chaindependencies or their risks that
they associate with China, thenit makes Canada an even more
important player within that,particularly between the EU and
Canada and UK and UK.
Stewart Muir (40:20):
Tej, I know you're a big reader because I read
your reviews in the FinancialTimes.
I wish I had some of the bookson my bookshelf that you've been
reading lately Power andProgress, innovation for the
Masses, any Happy Returns, theWar Below Any book.
You'd really recommend one ofthose, or maybe something else
that you're reading right nowthat is a must read for 2025?
(40:43):
.
Tej Parikh (40:44):
Well, it's actually not one for 2025, but the
Prisoners of Geography series isan excellent book because it
kind of gets to what wediscussed right at the start of
the podcast, which is Canada'sinnate economic advantages and
understanding how geographyplays a key, determining role in
(41:09):
your economic and even yoursocietal progress.
And so that's kind of where Iinitially got this inspiration
to look at Canada, because I wastaking a lot of the lessons
from prisoners of geography torealise, ok, geography is a big
part that explains how countriesprogress and develop.
(41:30):
I mean, the UK is a tiny islandand just off Europe, it had to
develop this outwardness andopenness to discovery and that's
kind of how the country emerged.
And then, if you look at Canada, that's where the question
marks came.
So you know why is it not evenmore kind of dominant than it is
?
So I would kind of say that's agood book to be reading.
Stewart Muir (41:53):
Sounds like proper grounding.
Now suppose the phone rang, tej, and Mark Carney your former
colleague from the gym as wellsaid I need to know how I'm
going to make Canada asuperpower and realize its
potential.
Loved your piece a few monthsago, tej, but I need your advice
.
What should I do in the nextcouple of years to make Canada
(42:17):
an energy superpower?
Tej Parikh (42:19):
Yeah, well, I'm sure he's already got his own 10
point plan for this.
I mean, I think the first thingis he should build on the
momentum that he has, thepolitical momentum he has on
reducing internal trade businessin Canada.
You then create the groundworkin order to start taking
(42:47):
advantage of the mineralresources and the natural
resources.
So I think that's the firststage just creating a better
business environment for Canadathrough those internal trade
barriers and then, secondly,thinking about how Canada can
start to share in the revenuesfrom these industries.
You know, once people start towell, canadians start to feel
(43:11):
that everyone is benefiting fromthe natural resources in the
country and there are avenues torecycle the revenues from those
sectors into the country,whether that's through housing
or developing infrastructure,improving public services.
You then have this kind ofreinforcement effect between the
country and its naturalresources and its assets and the
(43:33):
development of peoples, and Ithink working on that will kind
of provide the groundwork forCanada's emergence Sounds like
solid advice and I hope he hearsabout it and takes it, because
we do need to get things going.
Stewart Muir (43:52):
That's the consensus of probably more than
80% of voters in Canada thatthere is that frustration.
But look, tej Parikh, speakingto us from the Financial Times
in London, really appreciateyour time and your thoughts and
the thoughtfulness that you'vegiven to the subject of Canada.
I've spent a little time innewsrooms in London.
I know you can clear a meetingroom if you say I've got a great
(44:13):
story on Canada, but you'vedone it for us.
You've got that story in theprint and you've put so much
passion into the storytellingand the graphics.
I just love that piece and it'sbeen an absolute pleasure to
spend this time with you.
So thank you very much.
Thank you very much for havingme, thanks for joining us on
(44:35):
Power Struggle.
Until next time, keep thinkingabout where Canada's headed.
It's going to be quite a ride.
Give us a like, share and talkabout us.
Thank you.
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