Foreign ownership killing Canadian jobs
May 14th, 2010 - 4:00am
Over the past several decades, corporate ownership has extended beyond national borders. Foreign investment has grown by leaps and bounds, and we`ve seen many Canadian-born companies purchased by large multinational corporations. Many of these purchases happen without much fanfare, often in closed-door meetings that result in foreign ownership of Canadian brands. Foreign companies look to invest in Canadian corporations because, as we`ve seen since the recession, Canada is among the most economically stable countries in the world. The issue has become so pervasive that, according to Statistics Canada, foreign-controlled companies held over half of this country’s manufacturing assets, as of 2007.
However, the main stipulation for any current foreign takeover of a Canadian company is that it has to be, as the Investment Canada Act states, of “net benefit” to Canada. The act maintains that, among other things, the purchase must have a positive effect on the level of economic activity in the country, including things such as employment, national resource management, and the utilization of parts and services produced in Canada, just to cite a few examples. However, as we`ve seen over the past several years with the foreign purchases of many Canadian companies, they have not always been of “net benefit,” despite the stipulations that have already been put into place. Workers at the Vale-Inco mine in Sudbury have been on strike for 10 months now, with no sign of a resolution in the dispute between the United Steelworkers Union and Brazilian-owned Vale in sight.
That is why I was so pleased to see the passing of a motion to amend the Investment Canada Act two weeks ago. The motion, tabled by my colleague Claude Gravelle, the NDP Mining Critic and MP for Nickel Belt, would see a number of changes to the Act that would further ensure that all future foreign purchases of Canadian companies be of “net benefit” to Canadians. All opposition parties voted in favour of the motion, while the Conservatives once again showed they aren’t looking out for the interests of hard-working Canadians by voting against the motion that would put reasonable regulations in place to ensure we don’t have another Nortel fiasco on our hands.
The motion calls for three major additions to the Investment Canada Act:
• a lower threshold for public review;
• public hearings to be held in affected communities; and
• the publication of the reasons for decisions and conditions to be met by approved foreign owners.
These additions seem not only reasonable, but necessary, to ensure that foreign purchases are actually done in the best interest of the Canadian people. Allowing the people who actually live and work in communities that would be affected by foreign purchases seems logical. Would the people of Sudbury have approved the purchase of Inco by Vale if they had any inclination that the company would have forced them into a bitter strike? I would tend to believe this would be a doubtful outcome. Would lowering the threshold to review the purchase of a company to ensure it is actually working for the benefit of the Canadian people hinder companies that operate ethically? Again, I doubt it.
With the passing of this motion, our hope is that the Conservative government will start consulting with communities that are affected by foreign sales instead of simply allowing companies to purchase Canadian resources without a second thought.