Mr. Speaker, Canada is one of the most welcoming and profitable places in the world for international business and foreign direct investment. Canada’s economy, widely recognized as one of the world’s most innovative and stable, offers investors a series of competitive advantages, such as low business costs and corporate tax rates, ready access to markets, strong public support for R and D, and robust financial institutions. Industry Canada routinely meets with global stakeholders to promote Canada as an ideal location for investment in the automotive and manufacturing sector.
The Government of Canada understands the importance of the automotive and manufacturing sectors to the Canadian economy and has established a fiscal and economic environment that supports investment in these sectors. Government policies that support investment in Canada’s automotive and manufacturing sectors include streamlining regulations and reducing red tape; enhancing trade and market access; and investing in innovation and research and development.
Canada is alone among the Group of Seven, or G7, countries to receive the highest possible credit ratings from all the major credit rating agencies, which contributes to our strong global reputation. The Government of Canada has earned the trust of global investors for our responsible fiscal, economic, and financial sector management, which makes Canada an increasingly attractive destination for investment.
In Canada’s economic action plan 2013, the government announced $1.4 billion in tax relief for Canadian manufacturers by extending by two years the temporary accelerated capital cost allowance for new investments in machinery and processing and by creating a business tax environment that is conducive to foreign investment. Some 25,000 businesses in Canada used the accelerated capital cost allowance to write off the purchase of new investments and machinery since the federal government first introduced the measure in 2007.
By completing the Canada-EU comprehensive economic and trade agreement, CETA, we are opening up the largest market in the world for Canadian exporters. With CETA, Canada will be the only G8 country and one of the few developed countries in the world to have preferential access to the world’s two largest markets, the EU and the United States. This will make Canada the envy of trading nations and an even more attractive destination for investors and manufacturers looking to benefit from this access.
With regard to the automotive sector, the government has made investments in automotive research and development, such as Automotive Partnership Canada and Auto 21. The government has also made strategic investments in Canada’s automotive sector through the Automotive Innovation Fund, AIF, as the Government of Canada’s main lever to secure major automotive manufacturing investments. Introduced in 2008 and renewed in January 2013, the AIF has been highly successful, generating $2.3 billion in private sector investments by Ford, Linamar, Toyota, and Magna for advanced strategic projects to bring innovative and more fuel-efficient vehicles to market. These investments have generated significant economic benefits throughout the industry and for local communities. With a funding envelope of $250 million over the next five years, the AIF will continue to support major strategic automotive investments that contribute to the long-term competitiveness and sustainability of Canada’s assembly facilities.