BCBC: Provincial Government’s new economic development plan offers welcome vision, but lacks meaningful actions to attract investment that leads to medium term prosperity

February 17, 2022

The Business Council of British Columbia thanks Minister Ravi Kahlon and the Provincial Government for their new Economic Development Plan, which offers a vision of an inclusive and clean B.C. The Business Council supports this vision and values a sustainable economy for the benefit of British Columbians living in communities across the province today, and for future generations. While we will work with government towards these outcomes, the plan as presented lacks sufficient attention to some key conditions necessary to attain this vision we all want for our province.

“Prosperity must first be generated before it can be effectively shared and sustainably provide the supports and services our society and families rely upon,” said Greg D’Avignon, President and CEO, Business Council of B.C. “In our opinion, this plan provides an attractive vision of what British Columbia can become, but it does not contain the material actions required or send a strong enough signal to either the domestic or international business community that the government can provide the certainty necessary for new investments, including ESG capital to flow into or grow within the province, in order to ultimately help pay for that vision.

“Today, B.C. does not have the welcoming conditions required to attract the private sector investment dollars necessary to realize the full potential of the province’s advantages in natural resources, innovation, or people. As a more competitive world emerges from COVID-19, other jurisdictions are more attractive to investors and offer greater certainty. Provincially and nationally, we are a comparatively high tax jurisdiction with an uncertain and inefficient regulatory environment that has become too costly and too complex.”

The reality is that British Columbia is a small, open economy dependent upon trade and investment to grow the economic pie, and our individual and collective wellbeing. Just as individuals go outside their own household to generate revenue that becomes their personal income, so must British Columbia. Unfortunately, the government’s new Economic Development Plan offers little to address how we will expand our exports, and grow and retain innovative firms that enable higher wages and higher per capita economic growth.

The OECD predicts that, based on its per capita GDP growth rates, Canada will be the worst-performing advanced economy over the next decade unless we take action. British Columbia ranks around the Canadian average for real per capita GDP growth, which is directly linked to higher wages and improved quality of life for future generations. There is no reason to expect a different fate for the province over time other than an erosion of our shared standard of living. Significant policy action must be taken to position British Columbia and Canada as innovative, investment-ready economies with the capacity to enable emissions reductions, inclusivity and better health and social services for today and generations to come.

The business community stands ready, as we have done through natural disasters and the pandemic, to partner at speed, with common purpose, to realise our full potential for people and communities. For the province to succeed in meeting its goals of creating a more inclusive and sustainable economy that works for all British Columbians, several other elements are essential for the plan to improve British Columbians’ economic prosperity and to have a meaningful impact:

  • Encourage and support our most productive industries: Improve the conditions and factors that incentivize private sector investment in machinery and equipment, innovation and labour productivity-enhancing technologies that increases output by working smarter and more efficiently.
  • Embrace exports: Exporting delivers widespread economic benefits and is essential for advancing prosperity. Export growth in B.C. has lagged behind the rest of the economy and lags behind our global competitors. Ensuring B.C. develops and maintains competitive hosting conditions for companies in sectors that generate export earnings should be at the heart of an inclusive, innovative and sustainable provincial economic growth strategy.
  • Provide greater regulatory certainty: Capital is mobile, and even ESG-driven dollars seek secure, stable investments in predictable climates which can give a decent return on investments. A key lever government can pull in creating a strong economy is to ensure their regulatory structures are low cost, clear and timely, not cutting corners but enabling effective decision-making processes.

One area where British Columbia has a distinct global advantage, and which can support an inclusive and clean economy in communities around the province, is with our verified low carbon-intensive
natural resource products, including minerals, LNG and forestry products. We have an outsized opportunity to support a global reduction in GHGs by getting B.C.’s low-carbon resource products to market. This opportunity is also driving significant partnerships, meaningful reconciliation and sole source incomes for Indigenous peoples and their Nations. Key to achieving this goal are policies and a framework that provides a globally competitive carbon tax and regulatory certainty to advance the low carbon export, innovations and technology adoption for our most productive industries.

“The Business Council applauds today’s government announcement of a new Trade and Technical complex at BCIT and other efforts within the plan to support enhanced skills training so British Columbians are prepared to participate in the economy of the future,” said D’Avignon. “We also commend the government for acting on our advice to create an Indigenous economic development agency, and we look forward to supporting them in that endeavor, as well as with other initiatives referenced in the plan, including expanding life sciences, agritech and the ESG Centre of Excellence.”

A more inclusive and sustainable society and economy that supports growing household incomes, lifts people out of poverty, and provides people with opportunities to improve their skills so they can participate in the future economy is a just endeavor essential to the wellbeing of all British Columbians. It is also the outcome of a strong economy.

“B.C. needs an economic plan with more focus on investment attraction, growing the size of the economic pie per capita and scaling firms rather than a vision that contains no tangible measures or plan to act at speed on our advantages,” added D’Avignon.

The Business Council is committed to working with the province to achieve our shared goals of a more inclusive, innovative and sustainable B.C. economy and society.

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