TEGAN HILL: Business investment — a crucial economic indicator — down more than 50 per cent in Alberta
That matters. The U.S. is not only Canada’s largest trading partner, but provinces compete with the U.S. to attract capital and workers, including skilled workers. Relatively weak business investment compared to the U.S. indicates businesses see less opportunity in Alberta — a worrying prospect for economic growth in years ahead.
In part, this relative decline in business investment reflects the oil price collapse in 2014 . Moreover, oil and gas investment did not fully recover in Alberta as it did for our southern neighbour, which reflects an increase in regulatory constraints, policy uncertainty and an unfavourable business environment for energy development in Canada that particularly affects Alberta.Article content
But declines in the energy sector do not solely explain Alberta’s faltering business investment. More broadly, the Trudeau government’s recent tax and regulatory policies have helped spur an overall flight of investment capital from Canada. Even before the pandemic, from 2014 to 2019, nearly half of Canada’s main industries saw a decline in investment, including agriculture, forestry, fishing, utilities and retail trade.
Prosperity depends in large part on the strength of business investment. As such, Alberta’s relatively weak business investment should sound alarm bells and prompt policymakers — both provincially and federally — to enact policy reform. That means lowering taxes and reducing regulations to make Alberta a more attractive place to invest and do business.Share this article in your social network
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