Pipeline woes threaten Canada’s ability to compete: Scotiabank CEO

Canada has a competitiveness TORONTO problem, and impasses such as the one over the Trans Mountain pipeline expansion project aren’t helping, the president and chief executive of the Bank of Nova Scotia suggested Tuesday at the lender’s annual meeting of shareholders. Brian Porter said that it was important to look at the potential cost to the Canadian economy of not doing these sorts of projects, in terms of gross domestic product and what it means for per-capita income. “We’re going to lose our competitive advantage on a number of things,” Porter told reporters in Toronto. “Canada has a productivity issue, it has a competitiveness issue. We’d like to see the (Trans Mountain) project proceed, but we understand the difficulties involved.” Facing political opposition from the current government in British Columbia, Kinder Morgan Canada Ltd. announced Sunday that it was suspending all non-essential activities and related spending on the estimated $7.4-billion project. The pipeline battle has been an ongoing concern for the Scotiabank CEO, as Porter called in 2015 for an end to “inter-provincial bickering ” over energy projects. He said Tuesday that he has been disappointed. “This is really tough stuff, because we’ve been talking about it as a country for a long period of time and nothing ’s been done.” Porter is not the only one in corporate Canada wondering about the fallout from the Trans Mountain situation, but Scotiabank was a part of Kinder Morgan Canada’s $1.75-billion initial public offering in 2017, and the bank has helped the company with financing. Scotiabank, Canada’s third-largest lender, reported a profit of $8.24 billion for 2017, a 12-per-cent increase over the previous year. Speaking with media, Porter said the Trans Mountain expansion was important for Canada, and especially Western Canada. “I’m concerned about the resource-based economy and access to tidewater for our product,” Porter said. “The differential in Western Canadian crude is big.”

Porter’s view on competitiveness differed from that of Bank of Montreal CEO Darryl White, who told reporters last week, before the Trans Mountain suspension, that Canada did not yet have a problem in that regard. White did, however, say that it was something to watch.