Evidence of meeting #18 for Industry, Science and Technology in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was businesses.
A recording is available from Parliament.
5:15 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
We'll be happy to provide you with the figures, but I can assure you that we are very active in rural areas. In fact, we are more active in those areas than in the big cities, and we are also very active for small and medium enterprises.
5:15 p.m.
Liberal
The Chair Liberal Joël Lightbound
Thank you very much, Mr. Généreux and Mr. Cléroux.
The bells are starting to ring ahead of a vote. If I have the unanimous consent of the committee, we could finish the second round of questions, which would leave us about 10 minutes to ask questions. We can then go to the chamber.
Do I have everyone's consent?
Since no one seems to object, I will now give Mr. Dong the floor.
Mr. Dong, you have the floor for five minutes.
5:15 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Thank you very much, Chair.
I want to thank the witnesses, as did my colleagues. I appreciate your presence here.
To BDC, I read in the briefing prepared by the analyst that in 2021, there were 72,000 new business owners who were included in your total client number. Just out of curiosity, how many clients do you have? What's the number of your clients right now? Do you know?
5:15 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
Right now it's 75,000.
5:15 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Okay. That's pretty good.
Of all of that 75,000, what's the percentage of small and medium-sized enterprises?
5:15 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
I would say it's 99%—
5:15 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
—for SMEs.
5:15 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
I understand that there was some new programming introduced to help business during COVID. Do you have numbers to share with the committee on default rates prior to the pandemic and during the pandemic?
5:15 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
I don't have details on that. We can provide you with more details later.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Okay, please do.
We've been hearing that in Canada the brain drain is a problem. Talent, after they come up with their own IP, tend to move south due to the lack of access to capital. I know that BDC has a role to play in providing capital to small-sized businesses to keep them here.
You have the floor. What would you like to say to people who are thinking about moving their operation to the States because of lack of access to capital?
5:20 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
I think, in general, there are not that many who are moving to the States. There are many companies that are opening an operation in the States because it's often easier for a Canadian company do to business in the United States if they have a place of business, so we see that a lot. I would say that we see that much more than businesses that are moving their entire operation to the States.
We often make reference to U.S. companies buying companies in Canada, but every year we have more Canadian entrepreneurs buying operations in the U.S. than the opposite. Canadian entrepreneurs have been very dynamic, and they often make an acquisition south of the border to expand their business. One of the best secrets is that our entrepreneurs are very active. They are very dynamic and they buy companies outside Canada.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Thank you. I hope there are some stats to back that up.
The reason I'm asking this question is that I met with a company that currently hires about 50 people. It's a software management company that helps to maximize productivity for solar panels and whatnot. It's in downtown Toronto, and they are contemplating moving down to the States because they can't get access to capital here.
5:20 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
We can provide you with a study that we did, and you will see the numbers of business acquisitions of the two countries.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Thank you.
There's just one small confusion here. I see in the co-lending program, which offers up to $12.5 million to SMEs, that the financing split is 80% to 20% between BDC and private sectors, and it ends in December 2021. There is another similar program under BCAP, provided by EDC, that ends the same day in December 2021. Is there an overlap of programs, or are they just serving different types of clients?
5:20 p.m.
Vice-President, Research and Chief Economist, Business Development Bank of Canada
Karen, do you want to take this one? I think you have more knowledge than I do on this one.
5:20 p.m.
Vice-President, Partnerships and Government Relations, Business Development Bank of Canada
I believe that the amounts were different.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
One is $12 million and something, and one is $6 million and something.
5:20 p.m.
Vice-President, Partnerships and Government Relations, Business Development Bank of Canada
Yes.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Okay, but for clients who are qualified for one, are they qualified for the other automatically?
5:20 p.m.
Vice-President, Partnerships and Government Relations, Business Development Bank of Canada
Not automatically.
5:20 p.m.
Vice-President, Partnerships and Government Relations, Business Development Bank of Canada
I believe so.
5:20 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Okay. That's good to know.
I sit down with a lot of young entrepreneurs with brilliant ideas, but they're looking for a small amount of start-up funds. What's your general policy or attitude towards start-ups, especially in the tech field?
5:20 p.m.
Liberal
The Chair Liberal Joël Lightbound
That's a very open-ended question.
We will have to have a brief answer, Mr. Cléroux, please.