Thank you, Mr. Chair and members of the committee. It's nice to see many of you again. It is a privilege to appear before you in these unprecedented circumstances.
Before I begin, on behalf of our industry I want to acknowledge and thank Parliament for its work to support Canadians and Canadian businesses as they cope with the impacts of COVID-19 on their health and economic well-being.
I also want to give a brief shout-out to the committee staff for their patience, professionalism and proficiency in these challenging circumstances that most of us aren't used to when we come to committee.
Thank you.
While ready to discuss tonight the impacts of COVID on Canada's chemistry and plastics industries, I would like to take the opportunity to focus more on the future and what this committee and Parliament can and must do to ensure a robust and timely economic recovery.
That recovery must be premised on investment attraction. We know that COVID has put a strong pause on new investments in our sector and other sectors of the economy, but we have to remember that Canada's investment outlook was very troubling even before COVID. This was very well highlighted by the Barton advisory council. As well, it continues to be well articulated by the Business Council of Canada, the Canadian Chamber of Commerce and others.
We would urge you, as the committee, to reflect again on the analysis and recommendations that have come from those groups in the past. I welcome the opportunity to speak on this in more detail during the questions.
Concerning the chemistry and plastics sector in particular, I offer a few observations before turning to our brief recommendations.
First, demand in key Asian countries has already rebounded to pre-COVID levels. Inventories are at their lowest levels in a decade, and despite COVID, there's a return to record global volumes of chemistry and plastics production. While experiencing a short pause due to COVID, this $4-trillion global industry looks ready to return to its normal robust multi-decade rate of expansion, which amounts to nearly 1.5 times the global GDP growth rate each year, as it has done for nearly seven decades.
Second, as you've heard me say many times before, Canada's chemistry and plastics sector holds many advantages. With the right regulatory and investment conditions, we could better and fully participate in the global expansion of the industry and contribute to Canada's economic recovery. Moreover, key provinces, including Quebec, Ontario, Alberta and British Columbia, have all identified and prioritized the opportunities for investment in growth in the chemistry and/or plastics sectors.
However, despite the interest and activities of the provinces, the desired chemistry investments are less likely to occur without increased engagement and improved investment conditions within the realm of federal responsibilities.
We know that Canada's chemistry and plastics investments will make our economy more resilient and more innovative and will provide the critical building blocks for the low-carbon economy. We know there's a huge opportunity to provide the building blocks for a truly circular economy for plastic waste, and my brief recommendations today reflect those opportunities.
First, we recommend that the committee consider extending the full 100% accelerated capital cost allowance that was introduced in the 2018 fall economic statement, with no phase-out to 2030, and, specifically, making it permanent. This will send a signal to companies that have deferred projects because of COVID, or to global investors who are contemplating new investments in response to the provincial interests, that Canada is indeed open for business and respects the lengthy timelines for major capital investments for projects of $10 billion and more.
Second, we recommend that the committee recommend establishing a plastic technology innovation fund, with an initial allocation of $200 million. This will further research and development in circular economy technology applications across Canada. A focused initiative like this at scale will send a signal that Canada intends to be a leader in the development of advanced recycling technologies. The timing of this initiative in 2021 could be the cornerstone of Canada's hosting of the world's circular economy forum.
Finally, Mr. Chair, we recommend that as we emerge from the COVID-19 pandemic, all parliamentarians commit to an overall review of the business taxation and regulation regime in Canada. Building back better, simply put, requires an investment into Canada, and it's critical that our tax and regulatory codes be optimized to attract investment in innovation in the 21st century.
I look forward to your questions on these and any other matters. Thank you, Mr. Chair.