will be from the continued consolidation within financial services industries around the world. this poses a real competitive challenge to the financial services industry that is so important to the greater toronto area. indeed, while financial services companies may be concentrated around toronto, they are important to the whole province the finance, insurance, and leasing sector represents almost 15 per cent of ontario ’ s gdp. all these competitive challenges are compelling ontario ’ s businesses, politicians and policy - makers to find ways to increase industrial productivity and market efficiency. let me just stop for a second, because what i ’ ve said so far may sound overly negative about ontario ’ s economic prospects. we need to keep in mind that changes in the global economy are also creating income and wealth in china and india, thus increasing their demand for goods and services from abroad. these emerging markets are just that - markets. this source of growing demand can provide a boost to the global economy in general, and the ontario economy in particular. now, in the past two days, you have heard from people who are far more expert than i am about how individual sectors can meet this competition and take advantage of these opportunities. so i ’ m not going to try to add my own specific policy prescriptions to the debate. but i would like to point out some issues that i believe must receive considerable focus in order to position ontario to meet the global challenges facing us over the medium term. the first is the need to improve the efficiency of labour markets and the quality of ontario ’ s human resources. this is a critical element of ontario ’ s ability to meet future competitive challenges. to develop the skilled workers that this province will require to meet its labour demands, ontario must ensure that its education and training systems are second to none. this applies to early childhood education and development, the provincial school system, and post - secondary education and skills training. and all employers, both public and private, have a responsibility to provide their workers with opportunities to upgrade their skills. appropriate investment by individuals, by employers, and by governments, will be needed. but even the best - educated and trained workforce will still face inevitable economic adjustment that will lead to displacement and additional burdens on some groups in society. this does not mean that we should shy away from the task. but it does mean that a second area of focus should be to have policies in place that help to smooth the adjustment. these include providing access to training, or helping workers relocate or shift into expanding areas of the economy. the

david dodge : global economic developments and the implications for ontario remarks by mr david dodge, governor of the bank of canada, to the ontario economic summit, niagara - on - the - lake, ontario, 7 october 2004. * * * good afternoon. i am glad to be here, and to participate in this very important summit. it ’ s not easy to come up with something fresh to say this late in the conference agenda. my topic is “ ontario ’ s place in the world, ” but, of course, you ’ ve already spent a day and a half listening to the opinions of smart people who spend a great deal of their time studying this very subject. you ’ ve discussed at length the forces at play in the world economy, and how they are influencing canada ’ s economy and, of course, the economy of ontario. unfortunately, i have not been able to attend the entire event, so i have missed hearing many of the interesting speakers and presentations that have gone before. so, to contribute to this discussion about ontario and its place in the world, i thought that i would begin by giving you a brief synopsis of what i heard this past weekend at the meetings of the g7 and the international monetary fund in washington. i ’ ll recap what was said about the challenges facing the global economy, both over the next year and further out over the medium term. then, i will talk about how those themes and their implications relate to the ontario economy. the global economy in the near term one theme that i heard repeatedly in washington is that 2004 is turning out to be a better year than many had thought, particularly over the first half of the year. indeed, the imf is now projecting global economic growth of 5 per cent in 2004, which would be a marked improvement from the 3. 9 per cent rate seen in 2003. globally, while the united states continues to be an important source of growth, it is encouraging to note the very strong growth in asia and the improved momentum in europe. there have been a few factors underpinning this growth, including a still - favourable financing environment, and a general improvement in the banking sector and in private sector balance sheets and profitability. the outlook for consumption and investment in most countries continues to be good. this outlook bodes well for the rest of this year and 2005, even though there was a sense at the meetings that growth over this period will not be quite as strong as we saw in the first half of 2004