I have been watching the foreign direct investment flows into and out of Canada in recent years with increasing alarm. Obviously, there will be ebbs and flows here but the trend is decidedly outward and that is not good, long term, for economic growth here.
The latest OECD figures released this week show that in 2004, an estimated $6.3 billion in foreign direct investment came into Canada down from $66 billion in 2000. The 2004 figure is the lowest inflow of FDI into Canada since 1993 – at the tail end of the recession. Conversely, over $26 billion in investment flowed out of Canada in 2004.
Now, to put this into some perspective. Australia (a country with a smaller population than Canada) had $42 billion in inward investment in 2004, Belgium $34 billion, Ireland $14 Billion, Italy $16 billion and Spain $9.5 billion.
As by far the biggest beneficiary of FDI, Ontario is obviously spooked by this trend. They announced this week the establishment of four new International Marketing Centres in Tokyo, London, Los Angeles and New Delhi. Their sole purpose will be to attract investment from those countries to Ontario.
Even though New Brunswick has never really benefited from FDI, I think we should have a similar focus. A few billion in new investment would be just what the doctor ordered right about now to help the economy start to move in the right direction.