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Manufacturers call for urgent action on tax and regulatory environment to boost investment; competitiveness

Published by Marie Morden on January 27, 2017

TORONTO (January 27, 2017) - Canadian Manufactures & Exporters (CME) along with its strategic partners, releases Manufacturing a Competitive Business Environment in Canada, the first of five reports that provide detailed analysis and recommendations stemming from CME's Industrie 2030 initiative aimed at doubling manufacturing output by 2030.

Manufacturing Matters:

  • Directly employs 1.7million Canadians - 10 per cent of entire workforce
  • Directly and indirectly accounts 30 per cent of economic output and 27 per cent of employment
  • Directly responsible for over two-thirds of all exports

"Manufacturing is the linchpin of the Canadian economy," stated Mathew Wilson, Senior Vice President at CME. "However the sector has struggled in recent years with stagnating output and exports, declining productivity, and substantially decreasing investment. As a result, the Canadian economy as a whole has struggled. If manufacturing, and the economy as a whole, is going to grow, we need to dramatically boost investment in technology, products, processes and people. Boosting investment starts with having a competitive business environment - an environment that encourages and rewards growth."

Based on research and consultation through the CME led Industrie 2030 initiative, the business environment in Canada is getting worse. Increases in business taxes, regulatory demands, and energy costs along with reductions in government support programs were among the most cited challenges that are making it more difficult and costly to do business in Canada. Nearly half of all respondents to CME's survey stated the federal government does not support the growth of the company. That share rises to 60 per cent for provincial governments. And this is reflected directly in the statistics - for every $1 invested by a manufacturer in Canada, $8.65 is invested by an equivalent manufacturer in the United States.

"This report develops a strategic roadmap, with concrete recommendations, to build a more competitive manufacturing climate in Canada," said Michael Graydon, CEO, Food & Consumer Products of Canada. "We are calling on governments to work with us to begin to implement these recommendations in order to create and sustain long-term economic growth, with benefits to middle-class Canadians living in communities across the country."

To manufacture a competitive business environment in Canada we must:

  • Create a globally-competitive business tax structure in Canada that supports growth;
  • Introduce government investment concierge services;
  • Establish a Regulatory Bill of Rights for businesses; and
  • Increase investment in economic and trade-related infrastructure, including physical, energy and electronic infrastructure.

"Canada is not an island, and competition for investment in manufacturing is fierce globally," added Wilson. "Right now, Canada is not a competitive location for investment. Add this to the rapidly changing business environment in the US - a primary competitor for investment - with increased protectionism, promises of 20 per cent reduction in corporate taxes, massive reductions in red-tape and regulations, with no additional business taxes, and Canada's situation will only worsen. That is why it's urgent that governments work aggressively with the business community now on these recommendations and priorities."

To read the report, visit: http://www.cme-mec.ca/download.php?file=59kftghbl.pdf

About Industrie 2030
Through its Industrie 2030 initiative, Canadian Manufacturers & Exporters (CME) - Canada's leading trade and industry association and the voice of manufacturing and global business in Canada -consulted more than 1,250 leading industry executives and conducted detailed research to define specific recommendations to overcome challenges and create a roadmap for the future of manufacturing, to strengthen its footprint across the country, and to drive growth, innovation, wealth creation and jobs. Core recommendations include:

  • Building a strong labour pool and skilled workforce;
  • Accelerating adoption of advanced manufacturing technologies;
  • Fostering innovation, commercialization and new product development;
  • Creating a competitive business environment in Canada; and
  • Increasing access to domestic ‎and foreign markets.

This report is the first detailed report of the five core recommendations. Earlier reports, including the summary analysis and recommendations are available at www.industrie2030.ca.


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For more information, contact:
Marie Morden
Canadian Manufacturers & Exporters
Tel: (613) 355-8819
marie.morden@cme-mec.ca

 

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