The picture painted by Sen. Marshall of the fund suggests we’re doomed. Are things that bad? Not quite, but the strategy raises questions
Freeland’s response was not reassuring — Canada has to move faster than before because of the need to get on with the green transition and, more pressingly, it has to respond to the Biden Administration’s Inflation Reduction Act, which threatens to suck billions of dollars of investment and talent south of the border.
But Canada is a policy-taker, not a policy-maker, and it risks the loss of generational projects in clean technology, and a brain drain of its brightest minds, if it does not come close to equivalency to the subsidies on offer south of the border.Are things that bad? Not quite, but the government’s strategy raises plenty of questions.Article content
Those designing the structure of the Growth Fund suggest it will break the mould. Other programs are administered inside government and are not run by professional investment teams. The Growth Fund team will be able to use a range of instruments, including equity and debt, and will be more nimble when it comes to striking deals on, for example, carbon capture or biofuels.
In his new book, Where To From Here, the CIB’s chief proponent, former finance minister Bill Morneau, says the main challenge facing the bank was too many things going on in the Liberal government at the time. “The challenge in getting the Canada Infrastructure Bank up and running was a clear demonstration to me of the need for focus and management in our government. Unfortunately, we were not able or willing to invest the political capital needed to maximize its potential,” he wrote.
That is also entirely possible, given its stated goal of mitigating market demand, regulatory and policy risk. The CGF will accept below market returns and may accept higher exposure to loss, it says, which might make it more attractive to the private sector but should have the minister responsible reaching for the Pepto Bismol.Article content
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