Trump may scare off new investment in Canada: CME
Published by CME Manitoba on January 31, 2017
This article appeared in the Plant on January 30, 2017
Companies are “actively” eying the US as their base of future operations.
OTTAWA — Many large companies are becoming gun-shy about making new investments in Canada because of Donald Trump’s hardline stance on firms investing outside the US, says the head of a leading trade and industry group.
Mathew Wilson, senior vice-president of Canadian Manufacturers and Exporters, said the federal government needs to do more to attract investors because many companies – including long established, wholly-owned Canadian operations – are actively eyeing the US as their base of future operations.
“I can’t see any major corporation wanting to be the subject of a Twitter feed,” Wilson said in an interview.
“He (Trump) has shown that he will use his voice as loudly as possible to drive investment to the US.”
Wilson said he is seeing a “chilling effect” on investment outside the US as companies from across Canada approach him with a frank warning.
“If the US is going to reduce the cost of doing business and make it easier to do business, and they’re going to be protectionist and our primary market is already the US, then maybe we should be looking at moving our operations.”
He said Trump’s “laser focus” on increasing investment in manufacturing “is going to cause massive problems for the economy in Canada.”
Wilson wouldn’t name the names or companies doing the inquiring, but he said they run the gamut, from large corporations with operations in the US to small, wholly-owned Canadian firms with no US footprint.
All are paying attention to Trump’s every utterance, and are trying to assess risk accordingly, said Wilson.
That assessment comes as a new bank report warned that Trump’s protectionist policies could chop the growth rate of Canada’s gross domestic product by 1.5 percentage points.
While Trump could be good for Canada’s energy sector because of plans to revive the Keystone XL pipeline, any benefits will likely be offset by big losses in exports, the National Bank Financial Markets analysis says.
Found in: U.S. Presidency