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Why is Canada more expensive than other countries?




As the cost of living rises in Canada, many are struggling to afford housing, transportation, gas and even food. But data shows that even before the COVID-19 pandemic, the costs of everyday products and services in Canada have been some of the most expensive in the world.

Here’s where Canadians end up paying more than other countries, and why:


Compared to other countries that are part of the Organization for Economic Co-operation and Development (OECD), the price of basic wireless internet and cellphone packages in Canada is consistently among the highest in the world. Costs can be up to eight times more per gigabyte of data.

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According to a 2021 report by the Telecom Regulatory Policy at the Canadian Radio-television and Telecommunications Commission (CRTC), Canada’s average data usage “is fourth lowest among included countries, while its average revenue per user is the highest.”

Canada charges its users $11.92 per gigabyte per month, which is about six times the average charge in other countries of $1.86. Rewheel, a Finland-based telecom research firm, also confirmed in a 2021 report that the “Canadian wireless market … continues to be the highest or among the highest in the world,” compared to 40 other countries.

The firm placed the blame largely on the absence of telecom competition in Canada in a 2019 report that specifically investigated the country’s cellular market. The report also said the CRTC mandated “excessive” national roaming mobile data rates in Canada.

“The root cause of weak competition in Canada is structural (i.e. provincial network duopolies/monopolies). Significant structural remedies are required,” the report concluded.

Canada’s wireless network is currently dominated by Rogers, Bell and Telus; meaning Canadians have an unhealthy dependence on only three options. Its consequences were felt hard this year.

In July, Rogers experienced a major countrywide network outage, halting millions’ of Canadians’ ability to access their landline, cellphones, internet and television.

Rogers didn’t disclose how many customers were affected by the outage, however, the U.K.-based organization NetBlocks, which monitors cybersecurity, said the outage knocked out one-quarter of Canada’s observable connectivity.

Rogers had nearly 11.3 million wireless subscribers and more than 2.6 million internet subscribers in 2021, shows the company’s annual report for that year.

Several industries in Canada also took a hit from the outage. Businesses struggled to process payments from some customers, who were ultimately forced to take out cash. Financial institutions, including TD Canada Trust, BMO and the Royal Bank of Canada, said the outage had disrupted their operations.

Government agencies, such as Service Canada and the Canada Revenue Agency, reported outages to their phone lines as well.


While demand for housing is rising in Canada, supply is struggling to keep up. Canadian housing prices have more than doubled between 2005 and February 2022, growing at least twice as quickly as those of any other G7 nation by the end of 2021.

Canada has the worst price-to-income ratio among developed nations, according to recent data by the OECD, tied with Portugal and the Netherlands.

Canada is currently in a “home-affordability crisis,” Carrie Freestone, an economist with RBC, told on Wednesday. Buying a home in the Canadian market has never been more unaffordable, she said, as surging interest rates continue to drive ownership costs to record-high levels, according to an RBC report published in September.

Canada experiences a lack of housing supply in prime locations and cities, according to the RBC report, and demand is exacerbated by increased immigration and a growing younger population.

According to a former contributor and certified financial planner Patricia Lovett-Reid, there is a significant demand for urban lifestyle living in Canada, particularly in Toronto, Vancouver and Montreal. The high concentration of purchasers has increased demand, which has raised prices as a result, she said.

The problem is exasperated by Canada’s labour shortage, which gets in the way of meeting housing supply targets, according to the Canada Mortgage and Housing Corp. (CMHC). In an October report, it found that the number of workers per residential unit under construction has been decreasing in Ontario, Quebec and B.C., leaving each worker with more tasks to complete.

The CMHC announced in October that even under best-case scenarios, the amount of construction on new houses will fall well below the affordable housing supply targets it has set for Ontario, B.C., Quebec and Alberta to reach by 2030.

“It’s very hard to get people to work sometimes because they got used to staying at home and a lot of people got subsidized by government agencies,” Dana Senagama, a senior specialist in market insights at CMHC and one of the report’s authors, told The Canadian Press on Oct. 6.


Interchange fees – otherwise known as transaction fees or processing fees – refer to the amount a merchant or company must pay to be able to accept credit cards.

Whether making a purchase in person or online, the fee is deducted from each transaction and given to the bank that issued the card. (A fee is charged for debit card transactions, but it is much less compared to credit card purchases.)

Interchange fees have been restricted to less than one per cent in various regions of the world, including the European Union, Israel, the United Kingdom, China, and Australia. The average interchange fee in Canada, on the other hand, is 40 per cent higher at 1.4 per cent, making it one of the most expensive countries in the world to use a credit card.

It was announced last week that Canadian businesses can now pass interchange charges to customers directly, with the fees ranging from around one per cent to as much as three per cent for customers paying with credit cards.

Until recently, the high interchange rates were falling upon businesses, which would have to pay every time their customers made a purchase with credit. Now, that levy will fall upon Canadian consumers.

“Canadians pay among the highest credit card processing fees in the world but most don’t even know that they’re paying them now,” Canadian Federation of Independent Business (CFIB) president Dan Kelly told CTV’s Your Morning on Oct. 6.

“These costs are embedded in the costs of everything that we buy because they’re through merchants.”

Thanks to voluntary five-year agreements between the federal government and credit card firms, credit card transaction processing costs in Canada were reduced from an average of 1.5 per cent per each transaction to 1.4 per cent in 2020.

The finance minister at the time, Bill Morneau, predicted this charge reduction would result in annual savings of $250 million for small and medium-sized firms.

It is unclear why interchange rates in Canada are as high as they are but the recent move, which comes following a multimillion-dollar class-action settlement involving Visa and MasterCard, will now result in Canadian customers paying substantially more than most countries to use a credit card.

The Canadian government doesn’t have a cap on interchange fees, unlike many other countries.

The European Union set a 0.3 per cent interchange charge ceiling in 2015. Between 2015 and 2017, this adjustment alone helped EU businesses save up to two billion euros, according to a 2020 report by the European Commission.

According to a different 2020 study by the European Commission that looked into the impacts of the cap, “there is no systematic evidence” that banks reacted to the lowered fee by “increasing consumer banking fees or by making changes in issuing of cards.”

With files from The Canadian Press and’s Michael Lee

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Stock market news live updates: Stocks smoked as oil, tech stocks lead markets lower



U.S. stocks sunk Monday as investors digested the first releases in a week full of economic data and mulled what recent data could mean for Federal Reserve policy ahead.

The S&P 500 (^GSPC) fell by 1.8%, while the Dow Jones Industrial Average (^DJI) was down by 1.4%, or more than 480 points. The technology-heavy Nasdaq Composite (^IXIC) fell by 1.9%.

The economic data front provided further bearish signals for stocks, as key indicators came in stronger than expected. Leading the economic calendar for the week was the release of the Institute for Supply Management’s (ISM) services index. The index expanded faster in November than anticipated, at a 56.5 level compared to estimates of 53.5 and above October’s reading of 54.4, painting the picture of a still-strong services industry.

Meanwhile, new orders for U.S.-manufactured goods also beat expectations, rising 1.0% in October.

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In a separate report, however, S&P Global’s the Purchasing Managers’ Index (PMI) stood at a 46.2 level in November, down from the October reading of 47.8. New business activity fell at the sharpest rate since May 2020, S&P Global said.

The new data comes on the heels of Friday’s hotter-than-expected jobs report, which sent stocks to a choppy session. The strong job gains and robust wage growth are the opposite of what the Federal Reserve would like to see in its battle against inflation. Friday’s figures showed demand for workers remains out of balance with supply, signaling that Fed policymakers could either take rates higher than previously anticipated or hold them higher for longer in restrictive territory.

New readings on the producer price index (PPI) — which measures prices paid for goods and services before they reach consumers and consumer sentiment — will be out this week.

The narrative from U.S. central bank officials, now in their pre-meeting blackout period, has suggested they would downshift to a half-point hike at their Dec. 13-14 meeting, after four consecutive 75 basis-point increases. Investors are now wondering how much longer will the central bank continue to hold its tightening campaign, how high the federal funds rate will end up, and how long it will stay there.

“It’s fascinating that at the moment the market is focusing squarely on the very strong likelihood that we’ll ratchet down to ‘only’ a 50bps hike next week and extrapolating that level of dovishness rather than focus on any risks that the terminal rate could end up being nearer say 6% than 5%,” Jim Reid and colleagues at Deutsche Bank wrote in an early morning note Monday.

Meanwhile, another batch of third-quarter earnings figures will be out, finishing off the reporting season.

The yield on the benchmark 10-year Treasury note Monday moved back up past 3.5%, while oil prices fell as new sanctions on Russian energy took effect, with WTI crude settling at $77.33 per barrel. On Sunday, OPEC+, or the Organization of the Petroleum Exporting Countries and its allies, including Russia, stayed the course on planned production cuts.

In corporate news, Tesla (TSLA) shares sank more than 6% after Bloomberg reported that the company plans to cut production at its Shanghai factory, the latest sign of weak demand in China.

Slack co-founder and CEO Stewart Butterfield is stepping down from Salesforce in January, just a week after co-CEO Bret Taylor announced his resignation. He’ll be succeed by longtime Salesforce cloud executive Lidiane Jones. The news comes less than two years after Salesforce bought Slack for $28 billion. Shares of Salesforce (CRM) closed down more than 7%.

Overseas, Asian equities jumped on Monday after local Chinese authorities downgraded some of their strict COVID policies after public protests last week led to a major shift in Beijing’s commitment to its zero-COVID policy.

Elsewhere, in crypto world, Sam Bankman-Fried said he will testify before the House Financial Services Committee after he finishes “learning and reviewing what happened” in the collapse of FTX, the crypto exchange he founded.

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Hoping for a break on your grocery bill next year? Don’t bank on it, new report suggests



Anyone hoping for a break on sky-high grocery bills should brace themselves for a shock in 2023, as the typical family’s food bill for the year is predicted to go up by more than $1,000.

That’s one of the main takeaways of the 2023 Food Price Report, an annual publication by Canadian researchers that looks at factors across the supply chain to attempt to predict what the cost of putting food on the table will be.

Last year, the report predicted that a typical family of four would would spend more than $14,000 to feed themselves for the year — an increase of $966 from the previous year’s level and the biggest one-year jump in the 12-year history of the report.

“Last year we were predicting prices to go up by as much as seven per cent and many, many claimed that those predictions were alarmist,” said Sylvain Charlebois, a professor of food nutrition at Dalhousie University, who headed up the research team. “Yet here we are at 10 per cent.”

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While Canada’s overall inflation rate topped out at eight per cent this summer, food prices went well beyond that pace, clocking in at a 10.1 per cent annual gain as of the end of October.

It’s why instead of the $14,767 annual grocery bill forecast a year ago, the typical yearly receipt came in at $15,222.80 for 2022. That means last year’s “alarmist” report was actually undershooting how things would play out by more than $400.

Same issues persist

If those numbers are hard to swallow, prepare yourself for an upset stomach because all the factors that caused food bills to spike last year are expected to stick around into 2023. Charlebois and his fellow researchers say the typical grocery bill is on track to go up by another $1,065 from this year’s record high level.

“There’s absolutely no safe place at the grocery store,” Charlebois said. “You can’t really seek any sort of immunity against food inflation right now.”

According to the report, the typical family of four, with two adults and two adolescent children, can expect to pay $16,288 to feed themselves next year. That’s an increase of up to seven per cent, but some categories will be more expensive than others.

Not all types of food will go up at the same pace. Bakery items, meat and dairy should be in line with the overall rate, while fruit may be a comparable bargain at just five per cent. Vegetables, meanwhile, are expected to go up by as much as eight per cent.

That’s not what Julie Heyland wants to hear. A mother of three in Calgary, she says she couldn’t believe how much her grocery bill ballooned this year, even as the quality and quantity of food she was getting for her money didn’t seem to increase.

She cuts back where she can, but ultimately those ever higher food bills have meant she’s had to change her family’s diet. “In order to stay within our budget now we eat a lot less meat and I definitely shop a lot more sales and plan my menus around what’s on sale,” she told CBC News in an interview. “We’re eating a lot less meat and having more beans and a lot more rice and pasta during the week.”

Calgarian Julie Heyland says she has had to significantly change her family’s diet this year because of inflation. (CBC)

After a record-setting 2022, meat prices are not forecast to increase at a faster rate than food overall, but consumers should still brace themselves for prices to go up between five and seven per cent next year.

Jeffrey Bloom, a second-generation farmer who raises cattle on a farm in Turtleford, Sask., says he knows as much as anyone that prices for meat have skyrocketed this year, but the amount he gets per pound has barely budged, even as his costs have doubled.

After the record-setting run up in grain prices, cattle feed that might have once cost $300 a tonne is now going for $525, but he knows if he passes on that cost he’ll lose customers. “We’re looking at inflation rates of 75 per cent, which is almost unheard of, and it really cuts into your bottom line,” he told CBC News in an interview.

He recently saw an eight-pound prime rib selling at a meat counter for $200. “Well, $25 a pound is almost unreasonable for people to pay [but] we’re not seeing that kind of price ourselves, there’s a lot of in-between stuff where the inflation happens, with trucking costs and people just trying to make a living.”


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If he passed on his cost increases dollar for dollar he’d lose customers, so the challenge for food makers like him is “fighting the growing costs to sell the same products that everybody wants cheaper because they’re paying for it over the counter.”

While some of the factors that pushed up food prices have been lessened by Bank of Canada rate hikes aimed at reining in inflation, a lot of the factors making food more expensive are global in nature, and beyond the central bank’s influence.

The Russian invasion of Ukraine in February sent prices for everything from oil to grain to their highest levels in decades, for example.

The good news, Charlebois says, is that while consumers should brace for high prices to stick around at least into the early part of the year, he is expecting some of those increases to ease in the second half of the year as the global economic situation changes.

“We’re not expecting prices to drop, but we are expecting the food and inflation rate to to stabilize somewhat,” he said.

Supply chain bottlenecks are starting to move again, and the price of gasoline has fallen precipitously, which makes it cheaper to ship food across the country. On the other hand, a slowing economy could push down the loonie, which will hit grocery shoppers hard since so much of what Canadians eat comes from outside the country, especially in the winter months.

But when you add up all the factors at play, Charlebois says the long-term outlook is better than the short-term one. “Eventually all of these discounts up the food chain will catch up to consumers and we’ll see that at the grocery store,” he said.

Nisha Shringi and Vineet Saluja say they have been shocked by how much they have had to spend on food this year. They have cut out restaurant meals and trips to the cafe, but it’s still not enough. (Photo supplied by Vineet Saluja)

Those discounts can’t come fast enough for Nisha Shringi and Vineet Saluja. The couple recently moved to Toronto from Burnaby, B.C., with their two children, and while they were expecting their cost of living to increase, the uptick in what it costs to feed themselves has taken their breath away.

“The costs have increased everywhere,” Shringi said. “It’s crazy.”

Where they once might have enjoyed a restaurant meal out two or three times a month, and treat themselves to the odd fancy coffee at a local cafe once in a while, they’ve completely eliminated luxuries like that from their budget, because they need every penny to keep food on the table.

“We have definitely cut down on things that are not necessary,” she said. “We are just sticking to the essential items —absolute basic necessities.”

What can be done?

It sounds counterintuitive, but Charlebois says the spectre of recession might be what it takes to bring prices down, since consumers saying “no thanks” to expensive food items would bring prices down faster than anything else could.

“With an economic slowdown you will see fewer people willing to pay $30 for a steak and that really will help eventually.”

In the meantime, his advice for anyone looking to slash their grocery bill is the same as it was last year: use food apps to scour for sales, clip coupons to be on the lookout for bargains, and always keep an eye out for price cuts on food that’s about to go past its best before date.

“You’re going to have to work for your deals,” he said. “You’re going to have to work for those discounts.”

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Food delivery robots hit Canadian sidewalks, but many challenges delay mass adoption



When customers in downtown Vancouver placed orders with Pizza Hut in September, many of the pies landed on their doorsteps without a courier in sight.

Instead, diners were met by Angie, Hugo or Raja — autonomous robots resembling a cooler on four wheels with eyelike lights. They travelled by sidewalk to customers, who used unique codes to open their lids and reveal their food.

The value proposition for Serve Robotics — a spinoff of Uber’s 2020 food delivery acquisition Postmates that created the trio and a fleet of zero-emission robots — is simple: with slim restaurant margins, a labour crunch and climate change worries ‘”why move a two-pound burrito in a two-ton car?”

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A handful of other robotic delivery companies have the same ethos, but their paths to ubiquity are facing several roadblocks.

Delivery robots have been banned from some major cities like Toronto, which argued they are a hazard for people with low mobility or vision, as well as seniors and children. Cyclists already gripe about e-scooters in bike lanes and don’t want robots there either.

“They’re drawing a lot of attention from pedestrians while they’re out on the sidewalk because they’re not seeing them that often and people are excited to see them, but as usage continues to increase, this can cause a lot of congestion on already narrow sidewalks,” said Prabhjot Gill, a McKinsey & Co. associate partner focused on retail.

There’s also worries autonomous robots or ones manned by staff overseas will take jobs away from couriers.

Ali Kashani, Serve’s Vancouver-bred chief executive, considers the criticism to be a natural part of innovation that even the bicycle experienced, when it was invented and many thought it would cause divorce.

He’s tried to quiet concerns by ensuring his robots (Kashani won’t say how many there are) chime and flash their lights to alert people they are around. They are equipped with automatic crash prevention, vehicle collision avoidance and emergency braking.

Ultimately, he thinks they are “a win-win for everybody” because they reduce traffic, boost local commerce and help merchants get food to consumers in a less expensive way.

The environment benefits too because Serve replaces delivery vehicles. Kashani estimates roughly half the deliveries made in the country cover less than 2.5 miles and 90 per cent are completed by car. About two per cent of global greenhouse gas emissions worldwide are attributable to people using personal cars for local shopping and errands.

“There’s a lot of reasons to replace our cars with these robots as quickly as we really can, but there’s no reason for us to make anyone an enemy,” Kashani said.

Knowing how much opposition new ideas can face, Serve is careful to engage with governments and authorities before launching in a city, even if it has no legislation allowing or banning robots.

However, David Lepofsky, chair of the Accessibility for Ontarians with Disabilities Act Alliance, said there’s no way for such robots and humans to coexist because they will always present a tripping hazard and worse, they could be used to transport contraband or explosives.

He insists the fight he and others have waged to keep robots off sidewalks is not an attack on innovation.

“It’s not like we’re denying people a service,” he said. “We’ve got a way to deliver pizzas that we’ve had since we’ve had pizza delivery. It’s called human beings.”

Manish Dhankher, Pizza Hut Canada’s chief customer officer, agrees no pizza delivery is worth risking somebody’s safety, but said his company only partnered with Serve once the robots had made thousands of injury-free trips.

Serve robots only made nearby deliveries for Pizza Hut’s 1725 Robson St. location for two weeks, but the pilot generated “childlike excitement” from customers and had a 95 per cent satisfaction rate.

Dhankher stresses the goal was modernizing pizza deliveries, not cost reduction. Couriers made the same number of deliveries they did before the robots were in use.

But Pizza Hut isn’t ready to roll out robots permanently.

“We want to learn more,” he said. “What happens when you put this in the snowy areas of Saskatchewan and what happens when there is freezing rain?”

Another question: what happens when cities won’t welcome the robots?

Tiny Mile, a company behind a series of pink, heart-eyed robots named Geoffrey, knows the answer.

Years after Geoffrey started making Toronto deliveries for delivery services like Foodora, Lepofsky and others argued people may be impeded by stopped or stalled devices or unable to quickly detect their presence.

Toronto’s city council voted last December to prohibit the devices that run on anything but muscle power from sidewalks, bike paths and pedestrian ways until the province implements a pilot project for such devices.

Geoffrey was then spotted in Ottawa before the city confirmed such robots aren’t permitted there either and Tiny Mile decamped from Canada completely.

“We almost went bankrupt,” said Ignacio Tartavull, Tiny Mile’s chief executive.

“It was basically a miracle we survived.”

To keep Geoffrey alive, Tiny Mile headed to Florida and North Carolina.

“It was love at first sight,” Tartavull said. “We spoke with cities and they were basically competing for us to go there.”

He believes that adoration will spread as the cost of robot deliveries — now roughly $1 — sink to 10 cents in the next seven years.

“It’s likely going to take a few years before we have it in the big cities but in the long term, it’s kind of undoubtable because the technology is here, it works and we can deliver on time and at a much lower cost,” he said.

As for Serve, it’s focused on Los Angeles right now, but Kashani said its mission is to get five per cent of delivery vehicles off the road in the next five years.

“But I definitely hope that if you fast forward one or two decades, these robots would be doing more local transportation of goods… so that we can not rely on cars.”

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