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Results: 1 - 15 of 716
View Hunter Tootoo Profile
Ind. (NU)
Thank you, Madam Chair.
Thank you, Mr. Sikand, for sharing your time.
It's good to see you again, Stanley, Scott and Patrick.
One of the things that I've always said about Nunavut is that it's an untapped resource. The rest of Canada has been explored, dug into and capitalized on, but Nunavut hasn't. I think one of the things that we need as a country, to be able to tap into that resource and allow Nunavut to create a sustainable and stable economy, is that investment infrastructure. I've always said that national programs like this one, whether they be programs or formulas, don't take into account the uniqueness of the north: the time frame that it takes to get things done and the higher cost of doing stuff up there. I've always said that investment in infrastructure in the north is an investment in the Canadian economy, because everything that we need up north comes from the south.
I guess, having said that—and I'll leave it up to who would like to answer this—what would be the economic benefit to Canada from this project? Do you have any specific numbers that you'd like to share with us on that?
Patrick Duxbury
View Patrick Duxbury Profile
Patrick Duxbury
2019-06-04 12:47
I'll respond to that one. Thank you, Mr. Tootoo.
Yes, Nunavut has a small population but huge potential economically. The mineral sector is probably the brightest star in that constellation. We believe that our project would, at minimum, trigger the development of what is a world-class zinc lead deposit in the Kitikmeot region. It's called the Izok corridor project, and it would be triggered by the development of the Grays Bay infrastructure.
We did some economic impact assessment work on this, and just revenues to Canada in the forms of income tax, corporate tax and royalties associated with that development would be about $665 million. If you look at that as a cost benefit, the revenues coming just to Canada would pay for the infrastructure itself on one project. There are many other projects along that corridor that could be developed that would become more feasible with that infrastructure in place. That's just the first layer of opportunity there.
We also believe that that single project, that one mine, would probably generate something around $7.5 billion in GDP over an 11-year economic life. That's just 11 years. We think that project could be extended several years after, because what's happened is, in the absence of infrastructure, a lot of the developers who have played this area are not committed to doing any further exploration because, without the infrastructure in place, what's the point?
They know they have projects there, but until Canada decides it's going to build infrastructure that connects these resources to tidewater and to international markets, there's no further point to doing that work. Canada should be in the business of building its own infrastructure for its own benefit, and there will be lots of investments that will come to this region of the country once that investment has been made.
View Hunter Tootoo Profile
Ind. (NU)
You hit the nail on the head there I think. It's just something like...can we afford not to invest in it?
I think everyone knows there are very limited opportunities in Nunavut to create a stable, sustainable economy, and the numbers you just pointed out make it very clear that here's something that—and you can confirm—would create economic prosperity as far as jobs in the region for individuals, and also the business opportunities in the region and in the south.
Thank you.
Philip Cross
View Philip Cross Profile
Philip Cross
2019-05-09 11:18
Thanks for having me back.
I promise I'll limit my reference to data to the first two paragraphs, so don't be scared that I'm going to drone on with data from my StatsCan days forever.
Canada's real GDP fell by 0.1% in February, continuing a weak trend of only 0.1% growth over the last six months. Mediocre growth of less than 2% has persisted from 2015 to 2019, with the exception of a 3% gain in 2017.
Canada's slow economic growth is all the more striking in view of accelerating growth in the U.S., our main trading partner. Over the past four quarters, real GDP in the U.S. has risen by 3.3%, building on gains of 2.9% in 2018, 2.2% in 2017 and 1.6% in 2016.
The United States is the only G7 economy that has strengthened consistently over the last four years. What explains the unique buoyancy of the U.S. economy? One variable stands out as different in the U.S.: the steady acceleration of business investment. As documented in the Bank of Canada's recent monetary policy report, business investment growth in the U.S. has strengthened steadily from essentially nothing at the end of the Obama administration to nearly 7% over the past year.
Why is business investment robust solely in the U.S.? The upturn reflects the raft of pro-business initiatives from the administration, including historic cuts to corporate income taxes, accelerated writeoffs of capital spending, massive deregulation, and the most pro-business rhetoric seen from any administration in recent memory.
By contrast, business investment in Canada today is 13% below its peak in 2014, and the Bank of Canada anticipates another small decline in 2019. Of course, some of the weakness in business investment reflects the 2015 downturn in oil prices. However, investment since then has declined in a majority of industries despite the absence of a recession. As such, much of the retreat is due to factors within Canada's control. For example, pipeline firms want to invest more, but have been continually thwarted by government opposition and regulatory blockades. This fosters the growing impression in the global business community that Canada is not serious about committing to economic growth, focusing instead on the distribution and not the creation of income.
Some may claim that sustained employment growth reflects a buoyant economy. The regional breakdown of jobs growth suggests that new provincial government policies and attitudes to business have sparked these gains more than the macroeconomy. The upturn of employment, even as GDP has sagged, has been concentrated in Ontario and Quebec. As detailed in a recent commentary I wrote for MLI, firms in Ontario delayed hiring in the first half of 2018 until they were certain that the Wynne government would not be re-elected. That government had adopted several policies that made labour more expensive for firms. However, once a new government was elected in June, firms became more confident that their labour costs would not be subject to further unexpected increases and they resumed hiring. Hiring the former head of the Ontario Chamber of Commerce as chief of staff for the Treasury Board minister sends a resounding message to the business community.
A similar pattern played out in Quebec around the election of the CAQ government under François Legault. In the year before its election, jobs in Quebec fell outright by 0.6%. However, the election of the CAQ with a platform of tax cuts, no referendum on sovereignty and a firmly pro-business cabinet was followed by a surge in jobs, despite widespread reports in Quebec of labour shortages.
With employment surpassing output growth at the turn of the year, the effect is a further dampening of labour productivity. Stagnant labour productivity has become chronic in Canada with no net change since the oil price crash late in 2014. Lagging productivity is symptomatic of our declining competitiveness regularly cited by Canada's business leaders. Weak productivity reflects the failure over the last two years to engineer a transition to growth driven by business investment and exports.
In a little-noted speech in February, Bank of Canada Governor Stephen Poloz addressed the power and limitations of policy. He acknowledged the risks of maintaining low interest rates far longer than ever envisioned in 2008, including the stress for retirees who rely on interest income and the risk of rising household debt levels. Most importantly, Poloz acknowledged that economists do not have a complete understanding of how the economy works and how it will react in the future to policies adopted in today's uncertain global environment. It is time for more federal leaders to similarly recognize the limits of the government's ability to manipulate outcomes in our economy. Fostering a better environment where businesses can invest and grow may be one of the best initiatives it can make.
The trend of jobs in Ontario and Quebec underscores the importance already demonstrated in the U.S. of adopting pro-business policies and attitudes. Seeing new governments in Ontario and Alberta competing for the mantle of “open for business” shows that Canada is beginning to understand the necessity of responding to the pro-business administration in Washington. Former President Obama said, “The world needs more Canada.” If he'd understood Canada more, he would have added, “Canada needs more business.”
Thank you.
View Richard Cannings Profile
NDP (BC)
Just to clarify that, then, you talked about the dramatic growth in the Maori economy, which I'm understanding from what you're saying is based on an acceptance by the broader New Zealand population that this is how things should be done. There's just that integration of the Maori culture into the New Zealand culture. When I've talked to New Zealanders, to me that acceptance seems to be at a very different stage than what we see in Canada. Is that the reason for this growth in the Maori economy?
Chris Karamea Insley
View Chris Karamea Insley Profile
Chris Karamea Insley
2019-05-07 16:19
You're exactly right again. There is that growing acceptance. It's taken time. In my view it's taken 10, 20, 30 years to achieve that kind of acceptance. I will use one other example just to illustrate the point. One of the other things that I've been asked to become involved in, along with a number of other Maori business leaders, is to sit alongside our Ministry of Foreign Affairs and Trade to start to contribute to the development of international trade policy that reflects the particular interests of Maori people, given our size in the New Zealand economy. That acceptance goes further, with what we're now hearing from our government in New Zealand, in that the Maori economy and its culture have become New Zealand's point of difference in trading with other nations, for all of the various products that we will produce from our various parts of the economy.
Again, your point is a very good one. We have reached that point of acceptance by the wider New Zealand community. There is value for all, for the entire nation, by embracing the indigenous community.
Raylene Whitford
View Raylene Whitford Profile
Raylene Whitford
2019-05-07 16:21
I will just add some context for the individuals who haven't had an opportunity to visit New Zealand.
Here the Maori culture is very much integrated into the country. All of the place names are in Maori. There are Maori universities and Maori schools, and this is just a normal thing. This is an accepted thing. Maori is the country's second official language. It's very business as usual, whereas in Canada we're starting to see this resurgence in indigenous pride, renaming of streets, etc., but New Zealand is very much ahead in this respect.
I think that it's not that energy projects need to wait for this to happen; I think it's part and parcel. I think it's going to be a self-propagating entity if you're able to grow the knowledge of the country about and respect for the indigenous culture whilst giving the indigenous communities the opportunity to develop, to go internationally and to participate in these projects. It's going to enable both elements.
View David de Burgh Graham Profile
Lib. (QC)
Mr. Insley, I want to come back to a question from your opening comments. You talked about the rapid and phenomenal growth of the Maori-based economy in New Zealand. I'd like to learn more about the root causes of that. Where is success? What was the turning point? What lessons can we take from that, more widely?
Chris Karamea Insley
View Chris Karamea Insley Profile
Chris Karamea Insley
2019-05-07 16:37
I think that's a great question.
It's in two parts.
Why is it that the Maori economy is achieving these phenomenal growth rates? First, we have to acknowledge that the treaty settlement process has, if you like, created a pool of development capital available to Maori people that is now being reinvested back into the development of our own businesses, which we own completely. We own fishing companies. We own forestry companies. I was on the board of a highly successful energy company—geothermal energy—and that was stimulated by that initial settlement redress. We've had that pool of development capital made available through that process, but it's not only that.
We have some very talented and smart Maori companies today that are active in a whole range of different fields and have become highly vertically integrated, from the raw material right through to the end product that's being marketed around the world and promoted as being developed by this Maori community.
That all came about through my previous point about growing our young people with the best talent, to bring them back in with all of that talent that they have. It's those two things combined, and there's a third thing I should add, too.
The third thing—actually, there's a fourth thing—is to take a long-term view so that your planning horizon is long. It's not like what we've seen in the past with business per se, where the planning horizon was typically five years. Maori businesses can plan for 100 years. You ride out the ups and downs of prices and all of that kind of volatility.
The last point I'd make that contributes to that phenomenal growth rate is what's inherent within indigenous people, in my view, but certainly within Maori communities, to actually collaborate together and create scale. When you create scale, as you will know, sir, you create leverage. You create leverage in all sorts of ways.
It's a combination of those four factors that are driving these very real, very high, compound annual growth rates.
View David de Burgh Graham Profile
Lib. (QC)
Is the Maori economy leaps and bounds ahead of the non-Maori economy of New Zealand, or is it catching up at a very high rate of speed?
Chris Karamea Insley
View Chris Karamea Insley Profile
Chris Karamea Insley
2019-05-07 16:40
We're still very far behind in terms of absolute numbers, but the point is the compound annual growth rate, and this is certainly what our governments are paying attention to. There are ministers of our government now who are saying that the Maori economy has become the cornerstone of the New Zealand economy because of its growth rate.
Raylene Whitford
View Raylene Whitford Profile
Raylene Whitford
2019-05-07 16:40
I think that growth rate is 20% to 30% versus 2% to 3% nationally here.
View David de Burgh Graham Profile
Lib. (QC)
Without the Maori growth, the national economy would not be growing? Is that what I understand?
Chris Karamea Insley
View Chris Karamea Insley Profile
Chris Karamea Insley
2019-05-07 16:40
That's right. There are really very good reasons, in my view—and certainly it's happening in our country—to pay attention to the interests of the indigenous communities.
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