Some of the latest economic data don’t look good for Ontario: the national trade deficit (and Ontario is heavily reliant on trade) soared to an all-time high of $2.7 billion in July. The provincial deficit is almost $20 billion, obviously an uncomfortable figure.

But the most important story isn’t always in the latest lineup of dreary numbers. In fact, Ontario may be undergoing an historic shift, one driven by the need to compete head to head with the rest of the world. That’s a goal that’s received a lot of lip service in the past, but it appears that the necessary spine-stiffening from both politicians and the private sector may actually be underway.

Take several apparently unrelated events: the defining issue in the current race to replace Toronto mayor David Miller is how to achieve a $4.7-billion overhaul of the city’s grotesquely inadequate transit system. The debate, for the first time in 50 years, is not if the overhaul should occur, but how. By the time the new system is finished, Toronto’s international competitiveness as a place to live, work and locate a business will have moved up by several notches.

Last spring, the provincial government quietly passed what’s informally known as “wage restraint legislation.” Under the new law, public-sector employees will have their wages, benefits and perks frozen for two years, beginning in March 2010. There are numerous exceptions, but the basic message is clear: it’s time to start narrowing the unjustifiable gap between public- and private-sector compensation.

Ontario is also tackling one of its most pressing educational issues — the high-school dropout rate remains at an astonishing 25%-30%. All-day kindergarten, a proven method of giving more kids the early boost that leads to future academic success, began in 600 schools this fall and is planned for all 4,000 elementary schools by 2015. A skilled workforce, it hardly needs saying, is key when it comes to building a dynamic economy to compete with countries where a strong focus on knowledge industries is already producing remarkable growth despite a lack of natural resources: China, Korea and India.

Ontario is also working harder to promote its international interests. The province recently announced a new office within the Canadian Embassy in Washington, D.C. Albertans, those go-for-it cowboys, opened their own in 2004.

The province even seems to be capitalizing on some strengths it hardly seemed to know it had — until the global financial meltdown made them clear. Many decades of prudent financial management and regulation — which has its origins in calamitous economic failures during the Depression — have made Canada a poster child for solvency, the new benchmark of national competence. In an effort to seize an opportunity created by the financial crisis, Ontario and the private sector moved ahead last month with a previously announced plan to position Toronto as a world financial centre by establishing a new global risk-management institute.

There’s more: a new, high-profile Investor Advisory Panel at the Ontario Securities Commission sends the signal that regulators don’t plan on coasting when it comes to financial reform. And last June’s G20 summit, while too heavy-handed on security, also sent a powerful international message that Canada has the depth when it comes to sorting through the global financial mess.

“Never waste a crisis” can have a cynical ring. And it’s clear many Ontarians are still hurting and jobless. But it appears that, at least over the long term, there’s something to bank on when it comes to Ontario’s — and Canada’s — future prosperity. IE