Competitiveness and Trade related articles
Le 23 janvier dernier, conjointement avec le Comité Affaires et Économies (A&E) et le Comité de Leadership du Québec (CLQ), l’ACIC présentait sa stratégie de relations gouvernementales pour 2017.
Suite à une bonne discussion sur les objectifs et les enjeux prioritaires, la stratégie a été adoptée. La stratégie comprend les publics cibles ainsi que les actions concrètes qui permettront à l’ACIC et à ses membres de concrétiser les objectifs de la stratégie au cours de 2017. Elle identifie les enjeux prioritaires de l’industrie qui seront au premier plan aux représentations avec les parlementaires, cabinet de ministre et des représentants du gouvernement dans divers ministères.
Autour de ces enjeux, et de concert avec le CLQ et l’A&E, l’ACIC a finalisé ses messages clés afin de sensibiliser le gouvernement à l’importance de l’industrie de la chimie pour développement durable et économique du Québec et de mettre au premier plan les conditions qui pourront améliorer la compétitivité de l’industrie et favoriser l’essor économique de l’industrie de la chimie au Québec.
La stratégie de 2017 réitère l’importance de continuer à informer, éduquer et travailler en partenariat avec les acteurs clés du gouvernement (p. ex. les élus, et fonctionnaires), afin de trouver des solutions aux enjeux de l’industrie.
Au cours des prochains mois, l’ACIC, de concert avec ses membres, rencontrera des élus politiques et fonctionnaires des ministères clés pour les sensibiliser à nos enjeux prioritaires et établir un dialogue qui pourra générer des solutions qui favoriseront le développement économique du Québec et de l’industrie de la chimie.
On January 19, Bob Masterson, President and CEO of the Chemistry Industry Association of Canada, participated in the annual stakeholder luncheon held by the Alberta Industrial Heartland Association. The purpose of the luncheon was to take stock of 2016, discuss future opportunities for investment in Alberta, and provide attendees with updates on industrial development. Masterson spoke about the state of Canada’s chemistry industry as well as the global petrochemical sector in his presentation, Navigating Choppy Waters.
Masterson noted that global chemical production continues to grow, outpacing global GDP. In 2015 chemical sales totaled more than US$4 trillion, and analysts expect the figure to exceed $5 trillion by 2020.
“This should come as no surprise,” said Masterson. “Chemical demand is closely linked with population growth, societal development, and the needs and aspirations of a modern, growing middle class.”
But it is the U.S. that is benefitting from much of this growth, added Masterson. In the past five years, the U.S. has initiated more than 250 projects in the chemistry industry with a book value of almost CA$250 billion. Unfortunately, Canada has seen only 1 percent of this project value. This has been due to overly complex carbon pricing initiatives, indecision on energy infrastructure projects, and more.
But there is hope. A report published by the Canadian Energy Research Institute last year found that Canada can compete with the U.S. on a level playing field. This is where Alberta has been leading the way.
“Alberta is the one jurisdiction that gets it and is being creative to attract a greater share of value-added chemistry sector investment,” said Masterson. Late last year Alberta announced the two projects selected under the $500 million petrochemical diversification program, which should translate into more than $6 billion in private sector capital expenditures in the next few years. That’s a tremendous return on investment.
This initiative complements the more than $800 million provided under the previous provincial enhanced ethane extraction program, which realized significant increases to existing capacity utilization and investments in the province.
Alberta also seems intent on developing a greenhouse gas management approach that is capable of recognizing, rather than punishing, those firms that have invested in high-performing assets in recent years.
Masterson ended his presentation with a call to action. “If Canada is to survive and thrive during the next U.S. administration, we cannot continue to be indifferent to the deterioration of our investment competitiveness… If we are to safely navigate the increasingly choppy waters of the global economy during this period of change and uncertainty, we will need to be bullish.”
Masterson’s full speech is available here.
In advance of the drafting of the 2017 Ontario Budget, the Chemistry Industry Association of Canada (CIAC) has been actively engaged in key advocacy initiatives on behalf of its members. On January 10th, Bob Masterson, CIAC President and CEO, had the opportunity to participate in a pre-budget roundtable discussion hosted by the Honourable Charles Sousa, Ontario Minister of Finance.
Hearing the fiscal concerns raised by participants in the roundtable, Masterson took the opportunity to highlight the ways in which the chemistry industry, as solutions provider, can make significant contributions to many areas of the Ontario economy. “To achieve those contributions however,” Masterson explains, “the province will need to encourage economic growth by improving the investment environment.”
While the Chemistry industry has been in decline for more than two decades in Ontario, the sector does have several strengths to spur growth. These include:
- Sarnia’s proximity to cost-competitive shale gas production in the northeastern U.S.;
- established clusters with key infrastructure and skilled labour;
- the combined federal/provincial corporate tax rate of 25%;
- accelerated capital cost allowance treatment for manufacturing machinery; and
- the onset of commercialization of new technologies for producing chemicals from biomass.
These strengths have contributed to CIAC member companies making over $1 billion in new production capacity in Ontario since 2012. However, the province has the potential to attract much more chemistry investment activity. Based on historical trends, it should have seen a further $8 to $10 billion worth of investments.
Only economic growth will deliver the solutions needed to address the investment gap and generate jobs and prosperity for Ontarians. Action in the areas of: taxation, environmental regulation, Ontario’s regulatory framework, the integrity of industrial lands, and industrial electricity rates could all improve the investment conditions.
On January 20th, CIAC will have another opportunity to present its detailed recommendations in the identified areas when Don Fusco, CIAC’s Director, Government and Stakeholder Relations – Ontario, appears before Standing Committee on Finance and Economic Affairs as part of the 2017 pre-budget consultation.