Failure to Attract Investment Without Government Subsidies
I attended the House of Commons Standing Committee on Industry and Technology‘s hearing on Bill C-34 National Security Review of Investments Modernization Act. This Bill attempts to update and strengthen the Investment Canada Act through seven significant amendments. Mainly, these changes to the Act aim to protect Canada’s national security with stricter regulations and higher penalties
I had the opportunity to question Industry Minister Hon. François-Philippe Champagne, specifically about the huge subsidy to multi-national Volkswagen to build a plant in St. Thomas, but more generally, about Canada’s failure to attract international investment without such huge government subsidies.
Since this government came to office, investment in Canada has notably diminished. The issue is uncertainty for investors created by this government’s policies. We are down to 90% of the capital stock we had before this government took office.
In fact, the most prominent current investment comes directly from government – sometimes twice the amount that would be actually required to build, for example, the Volkswagen plant. How does the Minister plan to attract international capital investment that is not based solely on government subsidies?
Following up on my questions to Minister Champagne about Canada only attracting foreign capital investment by offering huge government subsidies, I noted that the entire value chain leading to the manufacture of electric cars is subsidized – every step of the way, from mineral extraction to final product, taxpayer money gifted to huge multinational companies. See if you can decipher the answer.
I also noted that the legislation we are studying – Bill C-34 – gives the Minister the sole authority to put his thumb on the scale and decide which foreign investors will be subsidized and which will not.
The record to date shows that taxpayers have contributed substantially to the companies, but those businesses keep the intellectual property (IP) for their own enhancement offshore. How are we protecting Canadian taxpayers’ investment in intellectual property?
Committee Meeting Notice and Transcript can be accessed here.