Thank you, Mr. Chair.
Good afternoon, lady and gentlemen members of Parliament. I am very happy to accept your invitation today to represent Canadian Manufacturers and Exporters and to submit our pre-budget consultation brief.
Canadian Manufacturers and Exporters represent about 10,000 manufacturing and exporting companies from everywhere in Canada. The association, which was created in 1871, was the first Canadian industrial association.
In a few words, what is the manufacturing sector? It is made up of a variety of sectors that include companies that exploit and process natural resources, aeronautics, automotive and agrifood processing companies, and it also includes 22 manufacturing subsectors of the Canadian economy.
The manufacturing sector generates approximately 10% of Canada's gross domestic product. It also produces two-thirds of Canada's yearly exports. The sector employs 1.7 million Canadians, who earn an average annual salary of $72,500, whereas the average salary for all industries combined is $57,900.
The sector has impacts in a multitude of other economic sectors, such as services, finance, logistics, transport, and many others.
Last week, Canadian Manufacturers and Exporters, our association, unveiled an ambitious plan to double manufacturing output and export by 2030. The plan, called Industrie 2030, is the result of about 100 round table consultations with manufacturers across Canada and the result of CME's biannual management issues survey. In our view, the next federal budget should implement a national industrial strategy based on Industrie 2030 that will accelerate innovation, increase investment, and help manufacturers reduce the carbon footprint.
Our two recommendations include, first, the creation of national clusters dedicated to the development and the adoption of digital manufacturing technology—for example, additive manufacturing, 3D printing, automation and robotics, and industrial Internet.
Second, we recommend increased direct investment in fast-growing companies by the creation of a risk-sharing loan program that will help companies innovate commercialized new products, both domestically and internationally.
Our third recommendation is to reform the scientific research and experimental development tax credit by conducting a complete legislative review of its legislation.
Number four is to implement the patent box tax regime to increase commercialization of intellectual property in Canada. A patent box tax regime means that we would reduce the corporate income tax rate on revenues associated with products that were commercialized with Canadian patents.
Fifth, we would like the federal government to expand the Atlantic Canada investment tax credit to nationwide coverage.
The sixth recommendation is to adopt a strategic procurement policy for all the federally funded infrastructure projects. This would emphasize the need to maximize domestic economic benefits for the manufacturing sector, including in particular fabricated steel products that are used in about 80% of our infrastructure projects, while respecting our current international trade obligations.
Finally, we would recommend that the federal government expand the green investment fund that will be implemented in Ontario soon that to support manufacturing investment in green technology.
I look forward to your questions.
Thank you.