Good morning, ladies and gentlemen. I'm Michael Darch, the president of the Consider Canada City Alliance.
I am pleased to comment today on behalf of 11 of Canada’s largest economic development agencies on the economic benefits we foresee in the Comprehensive Economic and Trade Agreement with the European Union. Joining me today is the president and CEO of Invest Ottawa, Bruce Lazenby. Invest Ottawa is a member of our organization, and Bruce is a board member.
Consider Canada is a new organization that represents 11 of Canada’s largest economic development organizations, and we'll be expanding to 14 in January. Our present members represent Halifax, Quebec, Montreal, Ottawa, Toronto, the Waterloo Region, Winnipeg, Saskatoon, Calgary, Edmonton, and Vancouver. We collaborate closely with each other, as well as with the Department of Foreign Affairs, Trade and Development and with other partners to enhance Canada’s ability to attract foreign direct investment to Canada. We strongly believe that a nation’s ability to attract and sustain foreign investment is best achieved through an integrated approach by all levels of government.
The increasing importance of cities in global economic flows is well illustrated here in Canada. Our members represent approximately 54% of Canada’s population and 56% of its employment base. But in the last five years, we've accounted for 72% of the GDP growth in Canada and a full 90% of the employment growth in Canada.
The signing of the agreement in principle of CETA could not have been better timed for us. The financial crisis in the United States once again illustrated our dependence on that economy. Attracting investment from Europe has always been difficult. First, employment laws in many European countries make it financially punitive to terminate staff in Europe, irrespective of their ability to perform in a new or revised position. That barrier has been removed as the financial crisis in Europe has made it necessary for many European countries to fully rationalize their employment for corporate survival.
Second, with our neighbour to the south being a dominant global economic power, expansion to North America meant expansion into the United States. Although the United States is poised to begin coming out of its financial crisis, its recovery remains an uneven process with few of the sound fundamentals that we have here in Canada. For the first time in decades, conditions have come together to move us away from the glare of the United States to compete for European investment on a more equal footing.
What does this have to do with CETA? First let us look at Europe. Just last Saturday we returned from a five-day investment mission to Europe having visited Madrid, Amsterdam, and Milan. Put simply, there is little growth potential in Europe. Companies looking for growth have to look elsewhere for business. Cultural, political, and economic factors raise the level of risk in many regions including Asia, the Middle East, Africa, and South America. That leaves North America. As I mentioned before, European companies have always looked to the United States. The Canadian Manufacturers & Exporters have identified $800 billion in energy, mining, and municipal infrastructure projects that will be done in the next 10 years. Many of those projects are already under way. Meanwhile, our American neighbour struggles to fully come out of its downturn, and its political system appears to be working hard to ensure that it never does. As Europe turns outward to look for future growth, the U.S. continues to look inward.
CETA places us firmly leading the way for sustainable growth in the new global reality. The agreement looks outward to international collaboration to establish strengths in global supply chains. It addresses the labour-mobility challenges that let companies enter new markets. It recognizes that national wealth and the strength of cities are increasingly built on services and, in particular, on high value-added services.
Investments are made on sound business and market fundamentals, not short-term financial incentives such as those used by many U.S. states.
Many will say that the benefits being touted are conjecture and unlikely to be attained. As I mentioned, we have just returned from Europe and we saw concrete examples of the benefits. We need capital to drive the full potential out of our growth in infrastructure and innovation. We had over 300 business-to-business meetings in the three cities, and these companies were bringing investment.
I brought along our chart from Milan, which shows clearly all cities had multiple meetings, and Toronto and Calgary were double-streamed.
The companies were not looking to create jobs in Europe. Some European workers would come over to train, but the discussion was about jobs in Canada. We are not talking just about jobs in the oil fields and mines. Several companies were looking to bring their R and D to Canada and to establish companies in Canada.
It is also not just about CETA. It is also about our openness and other policy changes that are facilitating business. For example, our immigration laws are encouraging the best, the brightest, and the entrepreneurs. All of our members were approached quietly by individuals having completed or near the completion of the process of becoming permanent residents of Canada. They were looking to open or grow companies here and, I may add, in Kelowna.
Europe is undergoing fundamental economic change. It is doing so because it is being forced. Our strong economic fundamentals let us manage change. As the negotiations are completed and the agreement goes through the approval process, Canada can manage that process to maximize the benefits to our economy. Europe and the United States are seeing their economies change, but they are being forced to change as they react to the impact of new global realities.
Canada has always been a trading nation with our economic prosperity tied to the ability to find our niche in global supply chains. With CETA and NAFTA, we sit in the middle of the largest trading and investment block in the world, with 950 million sophisticated consumers with a combined GDP of over $36 trillion. This combined with immigration, financial, and education policies that keep us open to the world will help us maintain a sustainable economy and continue the prosperity that our nation has enjoyed over the last six decades.
We should applaud the Prime Minister, Minister Ed Fast and all those ministers and individuals who have made this deal possible. We have never had the combination of tools and economic conditions to make the case for foreign investment in Canada that are now available. Last week was but the first step of our members to achieve those benefits.
The Consider Canada City Alliance looks forward to the completion of the negotiations of CETA and its ratification. It will strengthen our ability to attract foreign direct investment, create jobs and prosperity in Canada, and diversify our economy. CETA is a historic agreement and a great one.
Thank you, and we look forward to your questions.