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Cities Are Central to Canada’s Economic Recovery | Op-Ed

Canadian cities are the economic engines of the country. Collectively, urban areas represent about 86% of the national GDP and represent about 82% of the national population. As a result, the Canadian economy experienced one of its worst economic downturns when COVID-19 forced many urban areas to effectively lockdown.

  • Over 95% of reported cases worldwide have occurred in urban areas.
  • Worse, the pandemic has laid bare the vast inequalities that exist throughout cities by disproportionately affecting low-income communities and communities of colour.

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In Short: COVID 19 has laid bare the inequalities of our society by demonstrating how social inequality in urban centres leads our most vulnerable to be most heavily hit by crisis.

In Toronto, 83% of reported COVID cases are racialized despite racialized communities only accounting for 53% of the population.

  • These communities are less able to isolate in statistically overcrowded housing, are more likely to work in high-risk spaces, and have less access to resources.
  • These communities also suffer from poor urban planning as low-income communities also lack the spacious green spaces that are too often take for granted in high-income neighbourhoods.

It is in our urban areas where the linkages between the economy, the environment, and healthcare become obvious.

An adequate reaction to the current pandemic will then have to be both green and just if lasting changes are to be made. More importantly, these changes will have to have an urban focus.


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The global health crisis comes on top of a prevailing crisis; the climate emergency. Scientists are already linking the emergence of new viruses to loss of biodiversity and the industrialization of animal populations.

  • Even now, weak respiratory and heart systems due to decades of exposure to unclean air have made environmentally vulnerable people especially vulnerable to COVID-19, underlying the relation between air pollution and respiratory viruses.  

Canadian cities are on the frontlines of both the COVID pandemic and climate change.

Consequentially many economic, environmental, and health problems will manifest themselves in cities. But so do the solutions.


Municipal Solutions for a Global Crisis

Worldwide, it is often at the municipal level that some of the most effective, creative, and inspiring solutions are being found.

  • Policies like the Ultra-Low Emission Zone in London, the compost project in Sao Paolo, and the zero-carbon development project in San Francisco are all examples of how cities can accelerate economic growth, create social inclusivity, and have cleaner air.
  • According to the C40, climate action policies are 3x more likely to be implemented at a local level than a national level.

Michael Bloomberg once said, “while nations talk, cities act” in reference to the C40 Cities Climate Leadership Group – which Toronto, Montreal, and Vancouver are all members of.

Since then, the federal government has sought to support municipal initiatives with the Green Municipal Fund and various infrastructure projects – but such financing projects fall short of their promises.


Despite their importance and their proven ability to act on significant issues, Canadian cities are disempowered.

  • Issues of climate change, social inequality, and health crises are not just a consequence of poor urban planning but reflect how disempowered cities are under the Canadian federalist system.

Cities are considered to be children of the province under the Canadian constitution and essentially bare the governance responsibility of whatever the provinces deem they should (or do not want to pay for).

According to the United Cities and Local Governments (UCLG), a transnational municipal network, Canada treats its cities more like corporations than subnational legislative entities.

  • Canadian cities rely mainly on property taxes, service fares, and provincial/federal transfers payments for their financing.
  • They are also legally required to balance their budgets.
  • Consequentially most Canadian cities lack the autonomy of their international counterparts.

Before the pandemic, most mayors and councilors were very aware of the environmental and social issues facing cities. Due to their very tight fiscal budgets, however, opportunities for municipal-led economic growth are limited.

  • Generally, municipalities rely on either public-private partnerships or local-federal financing for infrastructure projects. Either way, local interests are often usurped by private desires of provincial/national politics.
  • Trudeau’s Investing in Canada plan, for instance, was supposed to funnel $180 billion in infrastructure funding through mayoral offices but all projects became actively managed and amended by Ottawa at the expense of local political concerns (not to mention the lengthy bureaucratic processes).
  • Likewise, public-private partnerships often handcuff local officials and lead to costly gentrifying projects that only exacerbate social inequalities.

The pandemic has only made the financial situation for municipalities worse. Cities like Toronto, Montreal, Vancouver, and Calgary have all stalled their major eco-investments while seeing the budgets being undercut by federal policies and stay-at-home orders.

The federal July 16th deal to give $18 billion to cities helped. The subsequent promises by 8 provinces to cover operating and transit costs helped more. Yet while the cities face the bulk of the crisis and the fiscal powers remain with Ottawa, cities are seen by many as a burden rather than engines of creativity and growth.

As Trudeau seeks to embed a green deal into the COVID economic recovery plan, trilateral perspectives can no longer be ignored. National health and climate programs can be substantive, but can also cause friction at the local level.

Indeed, decarbonizing the oil sands is desirable, but according to the COP, addressing the energy and building carbon footprints would do far more to reduce national emissions at a lower social cost. What is missing is the local financing.


Bottom Line: Issues of climate change, social inequalities, and health limitations are both fuelled and felt directly in urban centers. The pandemic offers an opportunity to empower municipal leadership.

“Never waste a crisis” so the adage goes.

To forget the urban perspective in Canada’s economic recovery will only stifle any federal attempts to create a more just society – especially in an increasingly urban world. The next economic recovery will have to be green, just, and urban.


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