CANADA – The Business Council of British Columbia recognizes the Canadian government’s commitment to a stable debt-to-GDP ratio as outlined in today’s federal budget, along with its focus on innovation and expanding the talent pool through greater gender equality and economic reconciliation.
However, the Council is concerned about projections showing an endless string of operating deficits and is alarmed at the lack of attention given to Canada’s waning competitiveness and disappointing business investment performance.
Although Canada’s economy grew briskly in 2017, economic activity is expected to downshift starting in 2018.
The fundamentals for medium-term prosperity are at risk. “The government is not doing enough to address the fact that Canada has become too costly, too complex, and too slow-moving to take advantage of new global opportunities – or to facilitate the investments needed to boost productivity and real wages,” says Greg D’Avignon, the Business Council’s President and CEO.
“The hard reality is that Canada is losing competitive ground globally across an array of traded goods industries, notably energy, other resource sectors, and many segments of manufacturing.”
“In order for every Canadian to have a real and fair chance at success, we must ensure our economy remains competitive – ultimately, this is the only way to attract the job creating investments needed to improve prosperity,” said Jock Finlayson, Executive Vice President and Chief Policy Officer.
Tax and regulatory changes in the US “have sharply eroded any competitive advantage Canada may have previously enjoyed, and they signal that we may soon see a redeployment of business capital to invest south of the border.”
Tax burdens influence the decisions made by businesses and by talented people and entrepreneurs. “Past hikes in personal income tax rates in Canada, including at the provincial level, make it harder for Canadian organizations to recruit and retain the highly skilled individuals who ultimately drive much of our economic success,” Finlayson noted.
The Business Council applauds the federal government’s commitment to increased gender equity, reconciliation with Indigenous People, parental leave flexibility, investment in child care, and maintenance of current trade agreements along with expansions in trade.
Additional measures to invest in research and innovation, particularly the British Columbia-led Digital Technology Supercluster, and also the Industrial Research and Assistance Program (IRAP), the national research granting councils, and additional Canada Research Chairs, are also welcome.
