David Dodge, governor of the Bank of Canada, called on policymakers to improve the efficiency of capital markets in a speech to the Ontario Economic Summit in Niagara-on-the-Lake, Ont.

In this speech delivered yesterday, Dodge shied away from specifying just how this should be done. But, he stressed, “We must not lose sight of the fact that the financial sector is an important contributor to economic growth in Ontario. An efficient financial sector will continue to be a competitive advantage for this province, both in maintaining efficiency in our own market, and in providing an opportunity to export expertise around the world.”

“So policy-makers have an interest in providing a framework that will allow our financial institutions and markets to compete in an increasingly globalized world. With global standards evolving rapidly, Canada and Ontario must be at the forefront in terms of efficiency and competitiveness,” he said.

Dodge suggested that the biggest challenge for Ontario’s service sector will be 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,” he said. “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% of Ontario’s GDP.”

He also stressed the need to improve the efficiency of labour markets and the quality of Ontario’s human resources; policies to improve labour mobility; improved provincial infrastructure; and, securing reliable sources of cost-effective energy for the future.