Investment outflow already underway in ‘real time’: RBC head

The head of one of Canada’s largest banks is urging the federal government to stem the flow of investment capital from this country to the United States — because, he warns, it’s already leaving in “real time.”

RBC president and CEO Dave McKay discussed some of his biggest concerns about Canadian competitiveness, particularly those related to recent U.S. tax reforms, during a recent interview.

Ottawa has come under pressure from corporate Canada to respond to a U.S. tax overhaul that’s expected to lure business investments south of the border.

McKay told The Canadian Press that a “significant” investment exodus to the U.S. is already underway, especially in the energy and clean-technology sectors.

The flight of capital, McKay added, will likely be followed by a loss of talent, which means the next generation of engineers, problem solvers and intellectual property could be created not north of the border but south of it instead.

Since the election of U.S. President Donald Trump, Canada’s investment landscape has been dealing with deep uncertainty related the ongoing renegotiation of the North American Free Trade Agreement. But many point to Trump’s recent U.S. tax measures as potentially more dangerous, fearing that dramatic corporate tax cuts in the U.S. will eliminate Canada’s advantage.