When it comes to attracting investment, Canada has some work to do
Canada is seriously lagging behind the United States and Mexico in the competition to attract foreign direct investment. A new research paper, Investment Attraction: Learning from “Best Practice” Jurisdictions by the Ivey’s David Moloney and Sandra Octaviani, looks at how these best-practice jurisdictions approach investment attraction and develops some important lessons for Canada.
Moloney and Octaviani examined investment attraction stars, including Mexico, Hong Kong, Singapore, the United States and Utah, to find the roots of their success. Their research found many of the key building blocks needed to attain best-in-class performance by the Governments of Canada and Ontario already exist but many shortcomings still need to be overcome, leading to three key recommendations:
1. Canada and individual provinces need explicit, joint strategies that identify areas of opportunity and are tailored to target firms;
2. Single window concierge services should be provided by the provinces to coordinate actions of both federal and municipal actors when engaging on a given project; and,
3. Engagement needs to be led from the top – Prime Minister and Premiers, Ministers and Deputy Ministers – with follow-up from technical experts with a deep understanding of the firm’s business.
Building on their research in a piece published for Maclean’s Paul Boothe and Moloney suggest incentives to companies are only one part of a larger strategy. Executing an effective strategy - playing the “long game” - is how best-practice jurisdictions succeed in the face of tough international competition.
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