Canada's resilience promises new opportunities

Ian McKay, CEO, Invest in Canada

flag of Canada

During this COVID-19 pandemic, Canada’s priority has been one of protection and preparation: protecting people’s health and safety while preparing business for a smooth transition to recovery.

By following the advice of Canada’s public health officials, this entire country—our citizens, business people and political leaders—have been working together to make sure we are well-positioned for a strong and resilient economic transition that will see more global investors choosing Canada in the weeks, months and years ahead.

This confidence I have in Canada’s resilience comes not only from past experience, but also what I am presently seeing and hearing from others.

One recent conversation that stands out involved a representative of one of Canada’s most important trade and investment partners, who believes Canada’s collective response to this crisis has been more effective than any other country in the world, particularly in terms of listening to the health experts, responding quickly, and delivering meaningful government support programs.

The proof is in the present

What kind of government support programs were being referenced? Let’s take a look at specific actions taken by the Government of Canada that global investors will want to know about.

On May 11, 2020, Canada’s federal government announced the establishment of the Large Employer Emergency Financing Facility (LEEFF), which offers bridge financing of up to $60 million or more to companies with annual revenues generally $300 million or higher.

That same day, the Business Credit Availability Program (BCAP), which had been established earlier in the pandemic to provide more than $10 billion of additional support to mostly small and medium-sized businesses, was expanded to include mid-sized companies with larger financing needs. Administered through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC), the program includes loans of up to $60 million per company and guarantees of up to $80 million.

Canada’s covid-19 economic response plan supports global investments

These recent updates are in addition to programs such as the new Canada Emergency Wage Subsidy, which covers 75% of salaries for qualifying businesses retroactive to March 15, 2020, with employers of all sizes and across all sectors of the economy being eligible.

There’s also the Government of Canada’s extended tax filing and payment deadlines, which allows all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after March 18 and before September 2020. This relief amounts to $55 billion in liquidity support.

Moreover, allowing businesses to defer all Goods and Services Tax/Harmonized Sales Tax (GST/HST) payments, as well as customs duty payments owed for imports, until June 2020 is the equivalent of providing up to $30 billion in interest-free loans to Canadian businesses.

Canada’s response to COVID-19 continues through such expanded initiatives as the Strategic Innovation Fund, which now supports projects to advance Canada’s medical fight against COVID-19, including vaccine and therapy clinical trials.

What’s more, opportunities through Canada’s Superclusters, including $50 million in funding from Next Generation Manufacturing Canada to support companies supplying essential equipment, products and therapeutics, also reflect critical COVID-19 responses for business.

As a Canadian, I am proud of how this country—from its federal, provincial and municipal governments, to its business community comprising both global and domestic investors, to its citizens nationwide, including both our frontline and background workers—has come together and shown such tremendous resilience in the face of this terrible pandemic.

I share this positive news on how Canada’s support programs are reassuring global investors while remaining fully aware of the current reality. As you read this, the COVID-19 virus continues to take more lives in Canada and around the world. We cannot forget this, even though we are all eager for economic prosperity to return as quickly as possible. We need to keep focusing resilience efforts on both protecting our health and preparing our economy for recovery.

On that note, I trust that you will stay safe and well. Brighter days are ahead.