Growth recipe shared: immigration, investment and infrastructure
OTTAWA The Trudeau government’s influential team of economic advisers unveiled a batch of growth-lifting recommendations Thursday that focused on immigration, infrastructure and investment strategies.
The objective, the experts say, is to double Canada’s projected growth trajectory and add an eye-popping $15,000 to Canadian households’ annual income by 2030. The suggestions comprise a first tranche of ideas from the group of external experts, enlisted by Finance Minister Bill Morneau to help Ottawa find ways to resuscitate Canada’s lacklustre economy.
The recommendations zeroed in on three areas: productivity-boosting infrastructure, attracting more foreign investment and opening Canada’s doors wider to a larger number of talented immigrants.
“Now is the time where we have to take very bold actions,” council chair Dominic Barton, global managing director of consulting giant McKinsey & Co., told reporters.
“(The suggestions) may not be new, these have been talked about before — but they haven’t been done. And so what we’re keen to do is to jolt it.”
The group called on Ottawa to deliver more than $200 billion worth of infrastructure projects over the next decade using as few taxpayer dollars as possible. To do it, the council suggests creating an independent infrastructure bank aimed at luring private capital by offering investors steady returns through user fees from projects like toll highways, bridges and airports.
“Canada should leverage the trillions in institutional capital waiting on the sidelines and focus this investment productively,” said the council report released Thursday.
The group also called on Ottawa to create an agency with a mandate to increase foreign direct investment in Canada that it believes could triple investment and add $43 billion to the gross domestic product in only a few years.
“These actions would bring much-needed coherence to what is currently a disjointed approach to foreign investment,” the report said.
It also recommended the federal government ramp up permanent immigration to 450,000 people a year over the next five years — with a focus on top business talent and international students.
“An increased immigrant population has positive implications for business and job creation for Canadians through entrepreneurship and innovation, international trade and if done right, can raise living standards for all Canadians,” the document said.
But Immigration Minister John McCallum, who was briefed on the recommendation, has already described that kind of a spike in immigration levels as overly ambitious.
“I think there are many arguments for more immigrants — we have an aging population, we have labour shortages, but there are also constraints. It costs a lot of money,” McCallum said Thursday.
“But we also have to consider the cost and the speed with which we can integrate them.”
Morneau assembled the external, 14-member council earlier this year to help the government build a plan to help Canada break out of its slow-growth rut.
The finance minister said the ideas are recommendations only at this point, and that the government will decide whether elements of them will be implemented.