Foreign investment in Canada lowest in 8 years

[Gone_Fishin]

Foreign direct investment in Canada plunges to the lowest in eight years

And for the first time in a decade foreign companies sold more Canadian businesses than they bought


Direct investment dropped 26 per cent in 2017 to $33.8 billion, Statistics Canada reported Thursday in Ottawa.
Bloomberg News
Theophilos Argitis

March 1, 2018
11:08 AM EST

Foreign direct investment into Canada plunged last year to the lowest since 2010, hampered by an exodus of capital from the nation’s oil patch and worries about the fate of the North American Free Trade Agreement.

Direct investment dropped 26 per cent in 2017 to $33.8 billion, Statistics Canada reported Thursday in Ottawa. Capital flows dropped for a second year, and are down by more than half since 2015. The investment that did take place was from reinvested earnings of existing operations. Net foreign purchases of Canadian businesses turned negative for the first time in a decade, which means that foreign companies sold more Canadian businesses than they bought.

The shrinking investment underscores how the energy slump is lingering in a Canadian economy that last year also began to face the additional headwind of growing U.S. protectionism. It also marks a setback for Prime Minister Justin Trudeau’s Liberal government, which has emphasized attracting foreign companies.

Falling foreign direct investment is important. The country’s economy has relied heavily on foreign funding since the global recession — totalling more than $500 billion since 2008 and about $130 billion over the past two years alone, according to balance of payment data.

Unlike portfolio investment, foreign direct investment is considered a stable source of funding that comes with the additional benefits of a transfer of know-how. Instead, an increasing amount of Canada’s funding needs are being met by short-term funds denominated in foreign currencies — which makes the country more vulnerable to a sudden loss of interest from foreign investors.

ConocoPhillips and Royal Dutch Shell Plc are among the companies that led the exodus from the nation’s energy sector last year.

snip

And the numbers continue to move in the wrong direction. According to Bloomberg data, foreign acquisitions of Canadian businesses fell to $3.8 billion in the fourth quarter, the lowest since 2009.


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[seewood]

A few things come to mind right off the get-go.
provincial tax rates. Cost of living in cities. Wages paid compared to other jurisdictions. Stupid NDP governments...

[Catsumi]

And let's not forget the gender budget which puts our overall debt load a few more billions into the hole. Apparently Morneau forgot (he has this problem from time to time) to adjust for this massive loss of revenue to the federal coffers.

Painful times a'coming.

[The Green Barbarian]

in before our resident math-challenged Marxists tell us all how this is somehow a good thing...because those evil Chinese are just plain evil...etc etc etc

[ninetyninepct]

Foreign investment is low and so is domestic. Canadians are also investing less in Canada and for good reason. High taxes, excessive regulation, confusing tax rules and a PM with the mental level of a 15 yr old.

I have started investing in China and South East Asia mutual funds and am selling off my Canadian investments. 18% return on my China funds. Should Trudeau win the next election I intend to divest most of my Canadian stuff, keeping a couple of cannabis things and invest more in a safer place. Cash is hidden in a few spots around the house along with gold and silver. Never know when the big one will hit the island. Ammunition would also be a good idea. Lots.

Just a reminder - shortly after being elected, Trudeau quietly passed "Bail-in" legislation. That gives Canadian Banks the right to seize our deposits and issue Bank stock or shares. Who the hell would want shares of a failing bank. Congratulations to all you Liberal voters. Your standard of living and quality of life is going to collapse before your eyes.

[Gone_Fishin]

in before our resident math-challenged Marxists tell us all how this is somehow a good thing...because those evil Chinese are just plain evil...etc etc etc

Not only are our resident Marxists math-challenged, but also they are terribly racist toward people from other countries and cultures who choose to invest (chose to invest is more appropriate, seeing as how that investment has become a thing of the past under Shiny Pony) in Canada. It would be interesting to see how many of these racist left wingers are actually unwittingly drawing a wage (if they even work) from foreign investment.