Lesson 2 - Attracting Foreign Investment

Provincial governments also provide information for foreign investors. The Ontario Ministry of Economic Development and Trade provides information on:

• Trade missions
• Business immigration
• Starting a business

The province runs the Ontario Investment and Trade Centre in Toronto, which helps potential investors source:

• Land
• Employees
• Technology
• Vendors

Major cities such as Vancouver, Toronto, and Montreal all offer investment services.

Infrastructure Advantage

• Canada has more than 300 commercial ports.
• St. Lawrence Seaway is the world’s longest inland waterway, allowing goods to travel easily from the Atlantic Ocean to the middle of North America.
• Canadian Pacific and Canadian National Railways have a combined rail system of 53,000 km.
• The Trans-Canada is the world’s longest highway, spanning all 10 provinces and connecting to 18 border crossings.
• Smart Border Accord, an agreement between the Canadian and US governments signed in 2001, facilitates the cross-border flow of travelers and goods, and co-ordinates enforcement efforts in the two countries.

Countries seek foreign investment because it:

• Increases economic activity
• Brings new technology
• Improves productivity
• Forces domestic companies to become more competitive

On the downside, foreign investment also:

• Detracts from a country’s identity
• The profits earned by foreign-owned companies do not stay in the host country

A Supportive Business Environment

A Great Place to Live

Cultural Diversity

Outstanding Employees

• Canada is ranked highly as an easy place to conduct and set up a business
• Offers excellent trade and investment opportunities
• Strong ties to Asia, Europe, and the rest of North America through imports and exports
• Stable economy with low interest, inflation, and unemployment rates
• Low corporate tax rates and offers tax incentives

Gateway to the World

• Canada spends more (as a percentage of GDP) on education than any other country (2010)
• Has most highly educated workforce in the world
• Canada ranks third in the world for enrollment in secondary

school

• Home to excellent

business schools

• Attracts highly educated immigrants who enhance and grow the workforce
• Immigrants are responsible for 70% of all labour-force growth
• 90% continue their education when they arrive in Canada (ESL programs, etc.)
• Liberal immigration policies
• One of the most multicultural countries in the world, with employees that speak many languages and have an in-depth understanding of other cultures

In 2009, the United Nations Human Development Index rated Canada as the fourth-best country in which to live.

The Human Development Index (HDI) is a statistic produced by the United Nations and used to rank countries, which measures three elements:

• Health (life expectancy at birth)
• Education (literacy rate and school enrollment)
• Standard of living (GDP per capita)

• In 2008, trade between Canada and the US was CAN$740 trillion (almost $1.4 million per minute)
• Seventeen of Canada’s twenty largest cities are within ninety minutes of the US border
• NAFTA has created opportunities for businesses located in North America (easy access to Mexico also opens the gateway to Latin America)
• Canada’s connections to Asia (through proximity - Western Canada, immigration links, and APEC) allow access to Asia’s growing economies (especially India and China)

The federal government attract foreign investment though its website, Invest in Canada. This website supplies information in a variety of languages to educate potential businesses on reasons to locate their companies in Canada.

Explore the website and determine the top reasons to invest in Canada. Write these in your notes.

Attracting Foreign Investment

Unit 5: Lesson 2