Posted: Jan 2, 2012 11:23 AM ETThe Associated Press
President Barack Obama and Congress are starting the election year locked in a tussle over a proposed 1,700-mile oil pipeline from Canada to Texas that will force the White House to make a politically risky choice between two key Democratic constituencies.
Some unions say the Keystone XL pipeline would create thousands of jobs. Environmentalists fear it could lead to an oil spill disaster.
A law Obama signed just before Christmas that temporarily extended the payroll tax cut included a Republican-written provision compelling him to make a speedy decision on whether to build the pipeline. The administration is warning it would rather say no than rush a decision in an election year.
It's a dicey proposition for Obama, who enjoyed strong support from both organized labour and environmentalists in his winning 2008 campaign for the White House.
Environmental advocates, already disappointed with his failure to achieve climate change legislation and the administration's decision delay new smog standards, have made it clear that approval of the pipeline would dampen their enthusiasm for Obama in this November's election.
Some liberal donors even threatened to cut off funds to Obama's re-election campaign to protest the project, which opponents say would transport "dirty oil" that requires huge amounts of energy to extract.
If he rejects the pipeline, Obama risks losing support from organized labour, a key part of the Democratic base, for thwarting thousands of jobs.
Obama appeared to have skirted what some dubbed the "Keystone conundrum" last month when the U.S. State Department announced it was postponing a decision on the pipeline until after the 2012 election. Officials said they needed extra time to study routes that avoid an environmentally sensitive area of Nebraska that supplies water to eight states.
The affected area stretches just 65 miles through the Sandhills region of northern Nebraska, but the concerns were serious enough that the state's governor and senators opposed the project until the pipeline was moved.
Republican Gov. Dave Heineman, who opposed the initial route, says he supports efforts to accelerate the project, noting that provisions in the payroll tax bill allow the project developer to find a new route avoiding the Sandhills.
The new route would have to be approved by Nebraska environmental officials and the State Department, which has authority because the pipeline would cross an international border.
The pipeline would carry oil from tar sands in western Canada to refineries in Texas, passing through Montana, South Dakota, Nebraska, Kansas and Oklahoma. The project's developer, Calgary-based TransCanada, says the pipeline could create as many as 20,000 jobs, a figure opponents say is inflated. A State Department report last summer said the pipeline would create up to 6,000 jobs during construction.
The payroll tax cut law gives the Obama administration 60 days to decide whether to allow construction of the pipeline.
An "arbitrary deadline" for the permit decision would compromise the process, short-circuiting time needed to conduct required environmental reviews and preventing the issuance of a permit, the State Department warned in a written statement on Dec. 12. Obama administration officials confirmed that view after the payroll tax bill was approved.
Republicans call the threat little more than an excuse that allows Obama to placate environmental groups while not rejecting the pipeline outright.
"The only thing arbitrary about this decision is the decision by the president to say, `Well, let's wait until after the next election,' " the Speaker of the Republican-led House John Boehner said.
Boehner and other Republicans say the pipeline would help Obama achieve his top priority — creating jobs — without costing a dime of taxpayer money. They hope to portray Obama's reluctance to approve the pipeline as a sign he favors environmentalists over jobs.
Russ Girling, TransCanada's president and chief executive, said his company would do whatever is necessary to make sure the project is approved.
"We've had more than enough surprises on this," said TransCanada spokesman Shawn Howard.
In Nebraska, where the pipeline faces strong resistance, state officials are awaiting an environmental study that will determine a new route. Officials have said the review will take six to nine months.
Some landowners in the Sandhills celebrated the decision to reroute the project, but the pipeline's strongest opponents say they still have concerns about the prospect of the government using its power of eminent domain to seize land, as well as liability issues in case of a spill.
"Republicans have bullied their way to get a reckless rider attached to a bill that was supposed to be about helping middle-class families," said Jane Kleeb, executive director of the group Bold Nebraska, which opposes the pipeline.
With the bill signed into law, Obama "must do the right thing for our land, water and families' health by denying the pipeline permit," Kleeb said.
Project supporters say U.S. rejection of the pipeline would not stop it from being built. Canadian Prime Minister Stephen Harper has said TransCanada could pursue an alternative route through Canada to the West Coast, where oil could be shipped to China and other Asian markets.
"Canada is going to develop this no matter what, and that oil is either going to come to the United States or it's going to go to a place like China. We want it here," said Rep. Fred Upton, R-Mich., chairman of the House Energy and Commerce Committee.
Opponents call the West Coast option farfetched, noting that Canadian regulators have announced a one-year delay for a similar project that would carry tar sands oil to British Columbia, on Canada's western coast.
Native groups strongly oppose both the Keystone XL and the Northern Gateway pipeline proposed by TransCanada rival Enbridge. Canada's First Nations have constitutionally protected treaty rights and unsettled land claims that could allow them to block or significantly delay both pipelines.
Unions are watching closely. Unemployment in construction is far higher than other industries, with more than 1.1 million construction workers jobless, said Brent Bookers, director of construction at the Laborers' International Union of North America.
"For many members of the Laborers, this project is not just a pipeline, it is a lifeline," Bookers said, adding, "Too many hard-working Americans are out of work, and the Keystone XL pipeline will change that dire situation for thousands of them."
Roger Toussaint, international vice president of the Transport Workers Union, opposes the pipeline.
"The dangers of the pipeline are compelling, and no one should believe the claims of either the Republican leadership or the energy companies, with respect to the project being shovel ready or with respect to the number of jobs it's going to produce," he said.
http://www.cbc.ca/news/business/story/2012/01/02/keystone-pipelines-congress.html
Showing posts with label Major Developments. Show all posts
Showing posts with label Major Developments. Show all posts
Monday, 2 January 2012
Sunday, 1 January 2012
John Baird crafts Canadian foreign policy with a hard edge
OTTAWA— From Wednesday's Globe and Mail
Last updated Sunday, Jan. 01, 2012 6:44PM EST
By: Campbell Clark
The man rewriting Stephen Harper’s foreign policy for majority-government times makes no apologies for stepping on a few toes. From climate change to Israel, Foreign Affairs Minister John Baird is willing to shrug off the gripes.
After five years of minority government, when a focus on short-term politics meant leaving relations with some parts of the world untended, Mr. Baird now has the task of broadening Conservative foreign policy and planning for the longer term.
But it’s not a mandate to please all. The image of Canada seeking to play honest broker and likable conciliator on the world stage is being changed by a deliberate edge to Conservative foreign policy. There’s a willingness to send the military, a high priority on economics and less qualms about raising hackles.
“Stephen Harper said it and I’ve said it: ‘We don’t just go along to get along,’ ” Mr. Baird said in a year-end interview. “There’s 194 countries in the world. I don’t agree with their foreign policy on everything,” he said. “You know the Russian Foreign Minister? His job is to stand up for Russia. My job is to stand up for Canadian values and Canadian interests.”
In a year when the world shook from financial crises and Arab uprisings, Canada’s place in it was shifting, too.
Even before Canada pulled out of a ground war in Afghanistan in July, it joined an air war in Libya. When it was over, Mr. Harper touted victory, and promised a military ready for more. He blocked part of a G8 leaders’ statement urging peace talks on Israel, and bucked the UN majority in vocally opposing a Palestinian bid for statehood. The Harper government closed a deal to harmonize security with the U.S. in return for projects to speed border traffic. And Canada made itself a symbol by withdrawing from the Kyoto climate-change accord.
Mr. Baird’s public image as a partisan pit-bull might make it seem that he was chosen to make foreign policy combative. But that’s a stage persona for a politician who is affable in person. As Foreign Minister, he worked to build all-party support for the Canadian mission in Libya. Foreign diplomats give him high marks for being more accessible and engaged than his predecessors.
But he is a thick-skinned politician who doesn’t wince over disagreements or worry about a little blowback. Canada was once alone on climate change for demanding all major emitters join a new treaty, but it’s a common view now, he said, and Canada’s pro-Israel stand at the United Nations has hardly affected its relations with others.
“I don’t have many foreign ministers or many foreign governments who raise climate change with me. In eight months, maybe two or three times,” he said. “I went to the Middle East for five days. No one raised our voting record at the UN.”
In the big events of 2011, Mr. Harper’s government kept a cold, calculating eye. It reacted with caution to Arab Spring protests in Egypt, but sent fighter jets to Libya.
Mr. Baird’s first trip as Foreign Minister, to meet rebel leaders in Benghazi, marked him the most – meeting professionals and public servants risking their futures in a struggle to oust Moammar Gadhafi. Ottawa went in big with a substantial military contribution, but Mr. Baird admitted that before the stunning collapse of Gadhafi forces, he feared a long war, and a death toll of 100,000 or 250,000.
The Tories’ cooler response to uprisings in Egypt and Tunisia remains marked by the view that a “big chunk” of the revolts were protests against unemployment and cronyism, not purely a call for Western-style democracy. Amid the election of Islamists in Egypt, Mr. Baird said the goal should be to move the region to more civil society, for intellectual freedom, and less corruption – and caution is still warranted.
The harder edge isn’t universal. On a trip to Beijing, Mr. Baird looked like a man trying to get along, calling China a “friend,” as the Harper government seals a new era after a chilly start in ties – but that, too, is a function of hard-edged economic interests with a major trading partner.
Now, Mr. Baird’s task is to broaden Canada’s foreign policy beyond the few priorities of minority years, like the United States, Afghanistan, China and Israel. A foreign-policy review is quietly under way, and Mr. Baird has signalled efforts to renew ties with untended regions such as Southeast Asia.
The short-term survival politics of successive Liberal and Conservative minorities have prevented ministers from travelling and making connections abroad, and limited planning, he said. “Governments are sometimes criticized for looking at things in four-year windows,” he said. “We’ve been looking at things in four-day, four-week and four-month windows for the last seven [years]. And that’s not healthy.’
The priority, as the United States and Europe face challenges and Canada needs to diversify trade, is economics. “That is the lens,” Mr. Baird said. With the U.S., Canada had success in reaching a border accord, but experienced a setback when the Keystone pipeline extension was delayed, he said. With China, Canada wants a foreign-investment agreement; with the EU, a trade deal.
But Canada needs to expand its foreign-policy planning beyond the biggest players, he said. “The countries that are going to be really important for Canada in the future also include Turkey, Vietnam, Indonesia, Nigeria. Those are pretty important.”
http://www.theglobeandmail.com/news/politics/john-baird-crafts-canadian-foreign-policy-with-a-hard-edge/article2284834/
Last updated Sunday, Jan. 01, 2012 6:44PM EST
By: Campbell Clark
The man rewriting Stephen Harper’s foreign policy for majority-government times makes no apologies for stepping on a few toes. From climate change to Israel, Foreign Affairs Minister John Baird is willing to shrug off the gripes.
After five years of minority government, when a focus on short-term politics meant leaving relations with some parts of the world untended, Mr. Baird now has the task of broadening Conservative foreign policy and planning for the longer term.
But it’s not a mandate to please all. The image of Canada seeking to play honest broker and likable conciliator on the world stage is being changed by a deliberate edge to Conservative foreign policy. There’s a willingness to send the military, a high priority on economics and less qualms about raising hackles.
“Stephen Harper said it and I’ve said it: ‘We don’t just go along to get along,’ ” Mr. Baird said in a year-end interview. “There’s 194 countries in the world. I don’t agree with their foreign policy on everything,” he said. “You know the Russian Foreign Minister? His job is to stand up for Russia. My job is to stand up for Canadian values and Canadian interests.”
In a year when the world shook from financial crises and Arab uprisings, Canada’s place in it was shifting, too.
Even before Canada pulled out of a ground war in Afghanistan in July, it joined an air war in Libya. When it was over, Mr. Harper touted victory, and promised a military ready for more. He blocked part of a G8 leaders’ statement urging peace talks on Israel, and bucked the UN majority in vocally opposing a Palestinian bid for statehood. The Harper government closed a deal to harmonize security with the U.S. in return for projects to speed border traffic. And Canada made itself a symbol by withdrawing from the Kyoto climate-change accord.
Mr. Baird’s public image as a partisan pit-bull might make it seem that he was chosen to make foreign policy combative. But that’s a stage persona for a politician who is affable in person. As Foreign Minister, he worked to build all-party support for the Canadian mission in Libya. Foreign diplomats give him high marks for being more accessible and engaged than his predecessors.
But he is a thick-skinned politician who doesn’t wince over disagreements or worry about a little blowback. Canada was once alone on climate change for demanding all major emitters join a new treaty, but it’s a common view now, he said, and Canada’s pro-Israel stand at the United Nations has hardly affected its relations with others.
“I don’t have many foreign ministers or many foreign governments who raise climate change with me. In eight months, maybe two or three times,” he said. “I went to the Middle East for five days. No one raised our voting record at the UN.”
In the big events of 2011, Mr. Harper’s government kept a cold, calculating eye. It reacted with caution to Arab Spring protests in Egypt, but sent fighter jets to Libya.
Mr. Baird’s first trip as Foreign Minister, to meet rebel leaders in Benghazi, marked him the most – meeting professionals and public servants risking their futures in a struggle to oust Moammar Gadhafi. Ottawa went in big with a substantial military contribution, but Mr. Baird admitted that before the stunning collapse of Gadhafi forces, he feared a long war, and a death toll of 100,000 or 250,000.
The Tories’ cooler response to uprisings in Egypt and Tunisia remains marked by the view that a “big chunk” of the revolts were protests against unemployment and cronyism, not purely a call for Western-style democracy. Amid the election of Islamists in Egypt, Mr. Baird said the goal should be to move the region to more civil society, for intellectual freedom, and less corruption – and caution is still warranted.
The harder edge isn’t universal. On a trip to Beijing, Mr. Baird looked like a man trying to get along, calling China a “friend,” as the Harper government seals a new era after a chilly start in ties – but that, too, is a function of hard-edged economic interests with a major trading partner.
Now, Mr. Baird’s task is to broaden Canada’s foreign policy beyond the few priorities of minority years, like the United States, Afghanistan, China and Israel. A foreign-policy review is quietly under way, and Mr. Baird has signalled efforts to renew ties with untended regions such as Southeast Asia.
The short-term survival politics of successive Liberal and Conservative minorities have prevented ministers from travelling and making connections abroad, and limited planning, he said. “Governments are sometimes criticized for looking at things in four-year windows,” he said. “We’ve been looking at things in four-day, four-week and four-month windows for the last seven [years]. And that’s not healthy.’
The priority, as the United States and Europe face challenges and Canada needs to diversify trade, is economics. “That is the lens,” Mr. Baird said. With the U.S., Canada had success in reaching a border accord, but experienced a setback when the Keystone pipeline extension was delayed, he said. With China, Canada wants a foreign-investment agreement; with the EU, a trade deal.
But Canada needs to expand its foreign-policy planning beyond the biggest players, he said. “The countries that are going to be really important for Canada in the future also include Turkey, Vietnam, Indonesia, Nigeria. Those are pretty important.”
http://www.theglobeandmail.com/news/politics/john-baird-crafts-canadian-foreign-policy-with-a-hard-edge/article2284834/
Wednesday, 28 December 2011
Canadian Auto Rebound Lags Behind US as Loonie Continues to Rise
28/12/2011 | By: Jason Siu
Reports are coming in that investment in Canada’s auto plants may fall to just $1.2 billion this year, the lowest since the mid-1980s. It’s also 62-percent lower than the past decade’s average according to Bank of Nova Scotia, which means Canada will continue to lag behind. To compare, Ford is planning to invest $13.3 billion in US plants over the next four years, leaving very little funding left for Canada’s plants. In fact, Ford this year closed their St. Thomas Assembly Plant in Ontario that had made their Crown Victoria and Lincoln Town Car.
This is a vast change of events compared to 2003, when Ontario, Canada was the largest North American producer of vehicles – taking the spot from the state of Michigan. But now their surging currency and companies in the US cutting labor costs has shifted investment back to the States.
Another factor impacting the spending is the fact that the US has a new labor agreement with the United Auto Workers (UAW), helping level the labor costs compared to foreign rivals. The Canadian Auto Workers (CAW) however are working with the automakers for a new contract for 2012. Unfortunately though, the CAW has fought many of the cost cuts the UAW has accepted.
http://www.autoguide.com/auto-news/2011/12/canadian-auto-rebound-lags-behind-us-as-loonie-continues-to-rise.html
Reports are coming in that investment in Canada’s auto plants may fall to just $1.2 billion this year, the lowest since the mid-1980s. It’s also 62-percent lower than the past decade’s average according to Bank of Nova Scotia, which means Canada will continue to lag behind. To compare, Ford is planning to invest $13.3 billion in US plants over the next four years, leaving very little funding left for Canada’s plants. In fact, Ford this year closed their St. Thomas Assembly Plant in Ontario that had made their Crown Victoria and Lincoln Town Car.
This is a vast change of events compared to 2003, when Ontario, Canada was the largest North American producer of vehicles – taking the spot from the state of Michigan. But now their surging currency and companies in the US cutting labor costs has shifted investment back to the States.
Another factor impacting the spending is the fact that the US has a new labor agreement with the United Auto Workers (UAW), helping level the labor costs compared to foreign rivals. The Canadian Auto Workers (CAW) however are working with the automakers for a new contract for 2012. Unfortunately though, the CAW has fought many of the cost cuts the UAW has accepted.
http://www.autoguide.com/auto-news/2011/12/canadian-auto-rebound-lags-behind-us-as-loonie-continues-to-rise.html
Monday, 26 December 2011
Retail invasion of Canada shows no sign of slowing
Mon Dec. 26 2011 6:48:12 AM | The Canadian PressTORONTO —
The influx of U.S. and foreign chains to Canada shows no sign of slowing as we head into a new year.
Marshalls, Express and Topshop were some of the retailers that opened up shop in Canada in 2011.
Another U.S. company appears poised to launch.
Catherine Fisher of Ann Incorporated, the parent company of Ann Taylor and Loft, says a formal announcement hasn't been made.
But she says they're "actively pursuing entry into the Canadian market" expected for late in 2012.
And U.S. discount giant Target is set to enter the Canadian market in 2013.
Daniel Baer of Ernst and Young says Canadian retailers will need to exploit their knowledge of the consumer and use the fact that they're homegrown to their competitive advantage.
He also notes companies won't just be battling for dollars.
Baer foresees more competition for retail talent like personnel to fill management and head office positions.
Kathy Perotta of The NPD Group says Canadian retailers need to work towards keeping -- and growing -- their existing share of the pie.
She says the total apparel and basics market is worth roughly 23.3 billion dollars, so new entrants to Canada are going to take their share from somebody.
http://www.cp24.com/servlet/an/local/CTVNews/20111226/121226_retail_US_Canada/20111226/?hub=CP24Home
The influx of U.S. and foreign chains to Canada shows no sign of slowing as we head into a new year.
Marshalls, Express and Topshop were some of the retailers that opened up shop in Canada in 2011.
Another U.S. company appears poised to launch.
Catherine Fisher of Ann Incorporated, the parent company of Ann Taylor and Loft, says a formal announcement hasn't been made.
But she says they're "actively pursuing entry into the Canadian market" expected for late in 2012.
And U.S. discount giant Target is set to enter the Canadian market in 2013.
Daniel Baer of Ernst and Young says Canadian retailers will need to exploit their knowledge of the consumer and use the fact that they're homegrown to their competitive advantage.
He also notes companies won't just be battling for dollars.
Baer foresees more competition for retail talent like personnel to fill management and head office positions.
Kathy Perotta of The NPD Group says Canadian retailers need to work towards keeping -- and growing -- their existing share of the pie.
She says the total apparel and basics market is worth roughly 23.3 billion dollars, so new entrants to Canada are going to take their share from somebody.
http://www.cp24.com/servlet/an/local/CTVNews/20111226/121226_retail_US_Canada/20111226/?hub=CP24Home
Sunday, 25 December 2011
Harper sees trade deals as key to his political success
JOHN IBBITSON |Columnist profile
OTTAWA— From Monday's Globe and Mail
Published Sunday, Dec. 25, 2011 7:25PM EST
Last updated Sunday, Dec. 25, 2011 11:21PM EST
Others may judge the Harper government by what it achieves, or fails to achieve, on the environmental front, with first nations or in making government more accountable. But Stephen Harper judges himself on how well his government manages the economy. In that context, nothing is more important to the Conservatives than trade.
By this time next year, either the Prime Minister will have one major agreement in his pocket and several more in the works, or this administration, by its own accounting, will have failed one of its most crucial tests.
The good news for the Tories is that they may soon clear the first and biggest hurdle. Government sources predict that a signed Canada-European Union Trade Agreement will be in place by February or March.
Some of the terms of that agreement will be contentious. EU businesses will have greater access to Canadian government-procurement contracts, for example. And dairy quotas for European imports will probably be raised, in exchange for increased quotas for Canadian pork exports.
But the deal is likely to be worth the concessions. Despite its problems – and they are legion – the EU remains the world’s largest common market, with 500- million people and a collective GDP of $16-trillion.
Improving access to that market is vital to this country’s long-term prosperity, which is why provincial governments are reportedly onside. (Negotiators also insist that the deal will clear all 27 European parliaments without difficulty. We’ll see.)
The EU agreement is vital to the Harper government’s second-most important goal: getting the member nations of the Trans Pacific Partnership to accept Canada’s application to join.
The TPP is emerging as a potentially powerful new trade bloc, as the Obama administration seeks to fashion a Pacific economic consortium that could rival China in size and influence.
Canada wants to be part of the partnership but has been shut out because the Conservative government continues to protect dairy and poultry farmers from foreign competition.
The word is that the Conservatives will use the agriculture provisions of the EU treaty to show the Pacific nations that Canada is willing to be flexible on agricultural subsidies. Maybe it will work; maybe it won’t.
If it doesn’t, then Mr. Harper will have to make an enormously difficult choice: give up on joining the Trans Pacific Partnership, which would be a severe blow to this country’s Pacific aspirations, or scrap supply management, which will enrage the all-powerful dairy lobby.
At the same time, the Harper government is exploring with the Chinese whether there is enough common ground to launch talks on a free-trade agreement, or whether to pursue sectoral negotiations instead.
The Conservatives have already negotiated a Foreign Investment Protection Agreement, or FIPA, as part of their trade negotiations with India. Both countries are waiting until Mr. Harper visits there next year to formally announce it.
As well, International Trade Minister Ed Fast will decide in 2012 whether to restart the stalled trade negotiations with South Korea, or abandon them entirely. Pork producers are anxious to see a deal, since the U.S. and Korea now have one, but concerns over Korean protectionism in the auto sector are holding that agreement back.
Hopes for progress in trade talks with Mercosur, the South American trade bloc, are fading. Argentina, in particular, is more interested in throwing up new barriers to trade than in tearing down existing ones.
But if the Harper government can sign agreements with the EU, China and India, and worm its way into the Pacific Partnership talks, it will be able to claim a robust record in expanding and diversifying trade.
If it can’t, then the Conservatives’ talk of protecting jobs and expanding overseas business opportunities will have proven to be just that: talk.
By the end of next year, we should know which it is.
SOURCE: http://www.theglobeandmail.com/news/politics/harper-sees-trade-deals-as-key-to-his-political-success/article2283361/?utm_medium=Feeds%3A%20RSS%2FAtom&utm_source=Politics&utm_content=2283361
OTTAWA— From Monday's Globe and Mail
Published Sunday, Dec. 25, 2011 7:25PM EST
Last updated Sunday, Dec. 25, 2011 11:21PM EST
Others may judge the Harper government by what it achieves, or fails to achieve, on the environmental front, with first nations or in making government more accountable. But Stephen Harper judges himself on how well his government manages the economy. In that context, nothing is more important to the Conservatives than trade.
By this time next year, either the Prime Minister will have one major agreement in his pocket and several more in the works, or this administration, by its own accounting, will have failed one of its most crucial tests.
The good news for the Tories is that they may soon clear the first and biggest hurdle. Government sources predict that a signed Canada-European Union Trade Agreement will be in place by February or March.
Some of the terms of that agreement will be contentious. EU businesses will have greater access to Canadian government-procurement contracts, for example. And dairy quotas for European imports will probably be raised, in exchange for increased quotas for Canadian pork exports.
But the deal is likely to be worth the concessions. Despite its problems – and they are legion – the EU remains the world’s largest common market, with 500- million people and a collective GDP of $16-trillion.
Improving access to that market is vital to this country’s long-term prosperity, which is why provincial governments are reportedly onside. (Negotiators also insist that the deal will clear all 27 European parliaments without difficulty. We’ll see.)
The EU agreement is vital to the Harper government’s second-most important goal: getting the member nations of the Trans Pacific Partnership to accept Canada’s application to join.
The TPP is emerging as a potentially powerful new trade bloc, as the Obama administration seeks to fashion a Pacific economic consortium that could rival China in size and influence.
Canada wants to be part of the partnership but has been shut out because the Conservative government continues to protect dairy and poultry farmers from foreign competition.
The word is that the Conservatives will use the agriculture provisions of the EU treaty to show the Pacific nations that Canada is willing to be flexible on agricultural subsidies. Maybe it will work; maybe it won’t.
If it doesn’t, then Mr. Harper will have to make an enormously difficult choice: give up on joining the Trans Pacific Partnership, which would be a severe blow to this country’s Pacific aspirations, or scrap supply management, which will enrage the all-powerful dairy lobby.
At the same time, the Harper government is exploring with the Chinese whether there is enough common ground to launch talks on a free-trade agreement, or whether to pursue sectoral negotiations instead.
The Conservatives have already negotiated a Foreign Investment Protection Agreement, or FIPA, as part of their trade negotiations with India. Both countries are waiting until Mr. Harper visits there next year to formally announce it.
As well, International Trade Minister Ed Fast will decide in 2012 whether to restart the stalled trade negotiations with South Korea, or abandon them entirely. Pork producers are anxious to see a deal, since the U.S. and Korea now have one, but concerns over Korean protectionism in the auto sector are holding that agreement back.
Hopes for progress in trade talks with Mercosur, the South American trade bloc, are fading. Argentina, in particular, is more interested in throwing up new barriers to trade than in tearing down existing ones.
But if the Harper government can sign agreements with the EU, China and India, and worm its way into the Pacific Partnership talks, it will be able to claim a robust record in expanding and diversifying trade.
If it can’t, then the Conservatives’ talk of protecting jobs and expanding overseas business opportunities will have proven to be just that: talk.
By the end of next year, we should know which it is.
SOURCE: http://www.theglobeandmail.com/news/politics/harper-sees-trade-deals-as-key-to-his-political-success/article2283361/?utm_medium=Feeds%3A%20RSS%2FAtom&utm_source=Politics&utm_content=2283361
Saturday, 24 December 2011
China Petrochemical Corp. Completes Purchase of Daylight Energy
By Benjamin Haas
Dec. 24 (Bloomberg) -- China Petrochemical Corp., the nation’s biggest oil refiner, completed the purchase of Canada’s Daylight Energy Ltd. for about C$2.2 billion ($2.16 billion), the company said in an e-mailed statement yesterday.
Sinopec, as the Chinese company is known, said it paid C$10.08 a share in cash for Calgary-based Daylight.
Cong Peixin, a spokesman for the China Petrochemical unit that carried out the transaction, declined to elaborate on the statement. Daylight confirmed the completed sale in a statement released yesterday.
The purchase gives the Beijing-based company access to more than 300,000 acres of land in areas rich with oil and natural gas, after falling crude prices made valuations attractive.
Sinopec Group, China National Petroleum Corp. and Cnooc Ltd. are seeking to gain technology through partnerships in order to develop China’s shale-gas reserves, estimated to be larger than those in the U.S.
China, the world’s biggest energy consumer, has partnered with Exxon Mobil Corp., Royal Dutch Shell Plc and Chevron Corp. to explore possible shale wells.
Chinese companies have announced $18.3 billion worth of bids this year for overseas oil and gas exploration and production companies, according to data compiled by Bloomberg. Cnooc bought Canada’s Opti Canada Inc. in November for $34 million in cash, agreeing to take on $2.4 billion in debt.
Daylight’s proven and probable reserves rose 46 percent to the equivalent of 174 million barrels of oil at the end of 2010, the company said March 1. The company’s production was 35 million barrels in the third quarter, according to data compiled by Bloomberg.
http://www.businessweek.com/news/2011-12-27/china-petrochemical-corp-completes-purchase-of-daylight-energy.html
Thursday, 22 December 2011
Asian demand for resources good news for British Columbia
By Darah Hansen, Vancouver Sun; With Files From Postmedia News December 22, 2011
British Columbia stands to be a big winner next year as Canada succeeds in diversifying its export markets for its wood products, according to the Conference Board of Canada.
B.C. wood has gained a significant share of China's wood imports over the past five years, increasing from less than one per cent in 2006 to 14 per cent in the first nine months of 2011, the board said in its report on the wood products industry.
At nearly $1 billion so far this year, the value of wood exports to China was more than twice last year's level for the same period, and is expected to continue to rise over the next five years.
"The China story is definitely a huge deal for B.C. wood producers," said Graham Sheppard, an industry analyst with ERA Forest Products Research.
Approximately 30 per cent of B.C. softwood lumber exports has gone to China in 2011, accounting for more than 95 per cent of Canada's total exports to the country.
Diversification into China, and, to a lesser degree, Japan, comes as Canada seeks to reduce its dependence on its next-door neighbour.
In 2006, 86 per cent of Canadian wood exports were sent to the United States, with B.C. wood accounting for about half the total. So far this year, the national share was 63 per cent. Michael Burt, director, Industrial Economic Trends, cited the fragility of the U.S. economy and endless rounds of litigation over softwood lumber as key reasons for the diversification push.
As a result, profits before taxes will rise to $565 million in 2012 from $283 million in 2011. Extending the forecast out to 2016, profits should almost double again from 2012 forecast levels to $1.04 billion.
http://www.vancouversun.com/business/Asian+demand+resources+good+news+British+Columbia/5897463/story.html
British Columbia stands to be a big winner next year as Canada succeeds in diversifying its export markets for its wood products, according to the Conference Board of Canada.
B.C. wood has gained a significant share of China's wood imports over the past five years, increasing from less than one per cent in 2006 to 14 per cent in the first nine months of 2011, the board said in its report on the wood products industry.
At nearly $1 billion so far this year, the value of wood exports to China was more than twice last year's level for the same period, and is expected to continue to rise over the next five years.
"The China story is definitely a huge deal for B.C. wood producers," said Graham Sheppard, an industry analyst with ERA Forest Products Research.
Approximately 30 per cent of B.C. softwood lumber exports has gone to China in 2011, accounting for more than 95 per cent of Canada's total exports to the country.
Diversification into China, and, to a lesser degree, Japan, comes as Canada seeks to reduce its dependence on its next-door neighbour.
In 2006, 86 per cent of Canadian wood exports were sent to the United States, with B.C. wood accounting for about half the total. So far this year, the national share was 63 per cent. Michael Burt, director, Industrial Economic Trends, cited the fragility of the U.S. economy and endless rounds of litigation over softwood lumber as key reasons for the diversification push.
As a result, profits before taxes will rise to $565 million in 2012 from $283 million in 2011. Extending the forecast out to 2016, profits should almost double again from 2012 forecast levels to $1.04 billion.
http://www.vancouversun.com/business/Asian+demand+resources+good+news+British+Columbia/5897463/story.html
Wednesday, 21 December 2011
[Exclusive] Canada resumes WTO threat over beef
By Kim Tae-gyu
Canada is threatening to resume its complaint with the World Trade Organization (WTO) should Korea fail to begin importing Canadian beef next year as previously agreed.
A source familiar with the issue said Wednesday that Canada is ready to return to a WTO dispute settlement panel because Korea’s National Assembly may not approve imports of Canadian beef due to a partisan standoff.
Korea promised to lift its eight-year ban on Canadian beef imports in June, which started due to mad-cow disease outbreaks there in 2003. In return, Canada dropped its complaint with the WTO.
``Korea pledged to import Canadian beef products from cattle aged less than 30 months, which are regarded as safe, from next year. But the country might not comply with the promise due to parliamentary wrangling,’’ the source said.
``In this climate, Canada has reiterated its willingness via various diplomatic channels to resume WTO procedures unless the Assembly keeps the Dec. 31 deadline.’’
The source expressed concern that Asia’s fourth-largest economy might suffer a host of problems.
``We might have to import beef from cattle older than 30 months or materials we agreed not to import regardless of age. And we have to remember that the European Union is keeping an eye on the Canadian case as a benchmark,’’ he said. Under the Korea-Canada contract, brains, eyes, spinal cord and other specified risk materials (SRM) are not supposed to be traded between the two nations irrespective of the age of cattle because they are believed to be more susceptible to carrying the disease.
``The hitch is that lawmakers worry too much about public sentiment since the mad cow row in 2008 involving U.S. beef imports. In addition, the ongoing partisan bickering is aggravating the issue.’’
The Lee Myung-bak administration agreed with the United States back in 2008 to restart imports of U.S. beef, which generated a nationwide uproar including months of candlelit protests because of worries about mad cow disease.
This prompted many lawmakers not to proactively deal with the Canadian beef issue.
On a far more negative note, the governing Grand National Party unilaterally passed the controversial free trade agreement with the U.S. last month, prompting opposition parties to boycott any other parliamentary discussions.
When contacted, the Ministry for Food, Agriculture, Forestry and Fisheries (MIFAFF) admitted that it is concerned about the possibility that the Assembly may fail to keep the deadline.
Yet, the ministry refused to confirm whether the Canadian government officially threatened to return to WTO action.
http://www.koreatimes.co.kr/www/news/biz/2011/12/123_101326.html
Canada is threatening to resume its complaint with the World Trade Organization (WTO) should Korea fail to begin importing Canadian beef next year as previously agreed.
A source familiar with the issue said Wednesday that Canada is ready to return to a WTO dispute settlement panel because Korea’s National Assembly may not approve imports of Canadian beef due to a partisan standoff.
Korea promised to lift its eight-year ban on Canadian beef imports in June, which started due to mad-cow disease outbreaks there in 2003. In return, Canada dropped its complaint with the WTO.
``Korea pledged to import Canadian beef products from cattle aged less than 30 months, which are regarded as safe, from next year. But the country might not comply with the promise due to parliamentary wrangling,’’ the source said.
``In this climate, Canada has reiterated its willingness via various diplomatic channels to resume WTO procedures unless the Assembly keeps the Dec. 31 deadline.’’
The source expressed concern that Asia’s fourth-largest economy might suffer a host of problems.
``We might have to import beef from cattle older than 30 months or materials we agreed not to import regardless of age. And we have to remember that the European Union is keeping an eye on the Canadian case as a benchmark,’’ he said. Under the Korea-Canada contract, brains, eyes, spinal cord and other specified risk materials (SRM) are not supposed to be traded between the two nations irrespective of the age of cattle because they are believed to be more susceptible to carrying the disease.
``The hitch is that lawmakers worry too much about public sentiment since the mad cow row in 2008 involving U.S. beef imports. In addition, the ongoing partisan bickering is aggravating the issue.’’
The Lee Myung-bak administration agreed with the United States back in 2008 to restart imports of U.S. beef, which generated a nationwide uproar including months of candlelit protests because of worries about mad cow disease.
This prompted many lawmakers not to proactively deal with the Canadian beef issue.
On a far more negative note, the governing Grand National Party unilaterally passed the controversial free trade agreement with the U.S. last month, prompting opposition parties to boycott any other parliamentary discussions.
When contacted, the Ministry for Food, Agriculture, Forestry and Fisheries (MIFAFF) admitted that it is concerned about the possibility that the Assembly may fail to keep the deadline.
Yet, the ministry refused to confirm whether the Canadian government officially threatened to return to WTO action.
http://www.koreatimes.co.kr/www/news/biz/2011/12/123_101326.html
Tuesday, 20 December 2011
The Changing Relationship of Canadian Business and Foreign Investors
Corporate Counsel | December 20, 2011
When the Australian mining and natural resources giant BHP Billiton Limited bid $40 billion to buy Canada's Potash Corporation of Saskatchewan Inc. in 2010, the Canadian government was quick to slam the door in its face, proclaiming that the merger would not be of "net benefit to Canada."
The decision floored legal experts. In trashing Billiton's hostile takeover on "net benefit" grounds, the government relied on the language of the 1985 Investment Canada Act (ICA). The act had been used only once before to block a deal, in 2008—and that one had potential national security implications.
Coupled with the earlier veto, the Billiton rejection seemed to transform a law once regarded as little more than a formality into a potential booby trap. It also stirred controversy about whether Canada was creeping into a protectionist cocoon—which the government vigorously denies.
Then something remarkable happened. Lazarus-like, Billiton came back two months later, announcing that a plan to develop the world's largest potash mine in the very same area had reached an advanced stage in the company's approval process. The difference was that no acquisition of a company was involved. Billiton was using land it had already acquired. And this time the same provincial leader who led the charge against the buyout scheme was trumpeting the benefits of the project.
The ripple effects of these contradictory official responses to the two projects are still being mulled by legal experts. They highlight an unexpected wrinkle for foreigners who want to invest in Canada. From now on, apparently, they will have to pay as much attention to politics and community relations as to the law, if they want to keep their deals on track. Especially when the federal and state governments they must deal with are in the throes of election campaigns.
"Ultimately, it is a political decision, and it doesn't hurt to have good political relationships," observes Peter Glossop, a partner in Osler, Hoskin & Harcourt's Toronto office, who, like the other lawyers quoted in this article, is knowledgeable about Canadian M&A but wasn't involved in the Billiton matter. (Billiton wouldn't comment.)
George Addy, a partner with Davies Ward Phillips & Vineberg in Toronto, believes in doing your homework. "You have to plan, and plan early," he says. "And you have to have feet on the ground—people in Canada who know the complexities of the various stakeholder interests."
As companies from all over the world—including China—rush to discover and exploit Canada's vast mineral, oil, and natural gas reserves, the question of "net benefit"—and whether it will kill a deal—is keeping many lawyers busy.
U.S. investors are in the front line of those who could be affected. In 2010 U.S. direct investment in Canada totaled more than $306 billion, or 55 percent of Canada's foreign direct investment, according to Canadian government figures. (U.S. statistics show that Canadians directly invested $206 billion in the United States in the same year.)
At the heart of the uncertainty is the fact that "net benefit" ultimately comes down to what many lawyers say is a subjective—and often political—decision by a single individual, the minister of industry, or, in some cases, the minister of Canadian heritage.
This is true even though the law lists the factors the ministers must take into account in reaching a decision on an acquisition. These include considerations ranging from the deal's impact on Canada's economic activity and competitiveness on world markets to the number of Canadians in senior management. By law, the review must be completed within 45 days, though the minister may take an additional 30 days.
http://www.law.com/jsp/cc/PubArticleCC.jsp?id=1324214245310
Saturday, 17 December 2011
Foreign investors cut back on Canadian securities
Financial Post
Foreign investors eased up on purchases of Canadian securities in October, adding just $2.03 billion to their holdings after buying $7.35 billion the previous month, Statistics Canada said.
Economists had expected foreign purchases of between $7.25 billion and $8 billion in October. The October acquisitions - which showed weaker demand for treasury bills and equities - were also much lower than an average of $9.2 billion over the previous three months.
Non-residents added $1.22 billion worth of Canadian bonds to their portfolios in October, led by the first investment in federal bonds in five months.
"This investment was partially offset by retirements of Canadian private corporate bonds and provincial bonds, mostly foreigncurrency denominated instruments," the agency said.
http://www.timescolonist.com/business/Foreign+investors+back+Canadian+securities/5876723/story.html
Foreign investors eased up on purchases of Canadian securities in October, adding just $2.03 billion to their holdings after buying $7.35 billion the previous month, Statistics Canada said.
Economists had expected foreign purchases of between $7.25 billion and $8 billion in October. The October acquisitions - which showed weaker demand for treasury bills and equities - were also much lower than an average of $9.2 billion over the previous three months.
Non-residents added $1.22 billion worth of Canadian bonds to their portfolios in October, led by the first investment in federal bonds in five months.
"This investment was partially offset by retirements of Canadian private corporate bonds and provincial bonds, mostly foreigncurrency denominated instruments," the agency said.
http://www.timescolonist.com/business/Foreign+investors+back+Canadian+securities/5876723/story.html
Friday, 16 December 2011
Russia's WTO membership important to Canada: minister
Source: XINHUA | 2011-12-16 | 
ONLINE EDITION
OTTAWA, Dec. 16 (Xinhua) -- Closer ties with Russia will bring more jobs and economic benefits to Canada, said Canadian International Trade Minister Ed Fast on Friday.
Fast made the remarks when he congratulated Russia on its successful accession of the World Trade Organization (WTO) after Moscow's membership was granted in Geneva on the same day.
"As a fast-growing economy, Russia offers great potentials. Its membership in the WTO will mean lower tariffs and improved access to Russia's goods market," said Fast in a statement.
He noted that Canadian companies are excited about their opportunities in Russia, especially as Moscow continues carrying out measures to better its trade and investment environment.
Taking the 2014 Sochi Winter Games as an example of the two countries' bilateral ties, the minister said architects and engineers from both nations are working side by side on the Olympic-related projects.
Currently, bilateral trade reached 2.8 billion Canadian dollars, or 2.7 billion U.S. dollars, in 2010, 12.3 percent up from a year earlier.
Russia is a major market for Canadian machinery, seafood products and aerospace products, and an exporter of fertilizers and chemical and steel products to Canada.
http://www.shanghaidaily.com/article/article_xinhua.asp?id=39628
ONLINE EDITION OTTAWA, Dec. 16 (Xinhua) -- Closer ties with Russia will bring more jobs and economic benefits to Canada, said Canadian International Trade Minister Ed Fast on Friday.
Fast made the remarks when he congratulated Russia on its successful accession of the World Trade Organization (WTO) after Moscow's membership was granted in Geneva on the same day.
"As a fast-growing economy, Russia offers great potentials. Its membership in the WTO will mean lower tariffs and improved access to Russia's goods market," said Fast in a statement.
He noted that Canadian companies are excited about their opportunities in Russia, especially as Moscow continues carrying out measures to better its trade and investment environment.
Taking the 2014 Sochi Winter Games as an example of the two countries' bilateral ties, the minister said architects and engineers from both nations are working side by side on the Olympic-related projects.
Currently, bilateral trade reached 2.8 billion Canadian dollars, or 2.7 billion U.S. dollars, in 2010, 12.3 percent up from a year earlier.
Russia is a major market for Canadian machinery, seafood products and aerospace products, and an exporter of fertilizers and chemical and steel products to Canada.
http://www.shanghaidaily.com/article/article_xinhua.asp?id=39628
Wednesday, 14 December 2011
Uranium mine ownership rules may ease
CBC News
Posted: Dec 14, 2011 10:02 PM CST
Last Updated: Dec 14, 2011 9:59 PM CST
A Saskatchewan MP, Brad Trost, has introduced federal legislation that would allow for more foreign investment in Canadian uranium mines.
Trost's bill would allow foreign investors to purchase and own the entirety of Canadian uranium mines and properties. Current rules limit foreign interest to a maximum of 49 per cent.
"This is a policy that has been supported by not just the current government of Saskatchewan but previous NDP and Conservative governments in Saskatchewan," Trost said Wednesday. "It would increase jobs and investment in our province and throughout the country."
Saskatchewan's north is home to most uranium mining activity in the country.
Trost said a change in ownership rules would not lead to any security risks because uranium is a highly regulated commodity requiring licenses to mine and export.
Saskatchewan recently said it would welcome eased ownership rules.
Last week the province's energy and resources minister, Bill Boyd, noted the federal rules date to the 1950s.
"We think it has had an impact on investment," Boyd said. "If there were a change, we think we would see further investment in Saskatchewan, we believe that that would be a good thing."
http://www.cbc.ca/news/canada/saskatchewan/story/2011/12/14/sk-uranium-mine-ownership.html
Posted: Dec 14, 2011 10:02 PM CST
Last Updated: Dec 14, 2011 9:59 PM CST
A Saskatchewan MP, Brad Trost, has introduced federal legislation that would allow for more foreign investment in Canadian uranium mines.
Trost's bill would allow foreign investors to purchase and own the entirety of Canadian uranium mines and properties. Current rules limit foreign interest to a maximum of 49 per cent.
"This is a policy that has been supported by not just the current government of Saskatchewan but previous NDP and Conservative governments in Saskatchewan," Trost said Wednesday. "It would increase jobs and investment in our province and throughout the country."
Saskatchewan's north is home to most uranium mining activity in the country.
Trost said a change in ownership rules would not lead to any security risks because uranium is a highly regulated commodity requiring licenses to mine and export.
Saskatchewan recently said it would welcome eased ownership rules.
Last week the province's energy and resources minister, Bill Boyd, noted the federal rules date to the 1950s.
"We think it has had an impact on investment," Boyd said. "If there were a change, we think we would see further investment in Saskatchewan, we believe that that would be a good thing."
http://www.cbc.ca/news/canada/saskatchewan/story/2011/12/14/sk-uranium-mine-ownership.html
Monday, 12 December 2011
Ottawa makes deal with United States Steel
Jeff Gray — LAW REPORTER
Published Monday, Dec. 12, 2011 3:18PM EST
Last updated Monday, Dec. 12, 2011 7:22PM EST
The federal government has dropped its legal case against United States Steel Corp. for breaking promises to maintain jobs after its 2007 takeover of Hamilton’s Stelco. In exchange, the company pledged to keep producing steel in Canada until 2015 and invest an additional $50-million.
The deal snuffs out a high-stakes court fight between the federal government and the Pittsburgh-based company. But lawyers who advise foreign investors say it sends a signal that Ottawa is serious about enforcing promises made to secure government approval of foreign takeovers.
Under the deal, he said, U.S. Steel pledged to keep producing steel in Canada, operate its Lake Erie and Hamilton plants until 2015 and invest at least $50-million in its Canadian facilities by December, 2015, in addition to its original pledge of $200-million by October of next year. The company also pledged to give $3-million to “community and educational programs” in Hamilton and Nanticoke, Ont.
“U.S. Steel’s new commitments, many of which run to 2015, will provide benefits that in all likelihood would not have been obtained through the court process,” Mr. Paradis said.
The deal comes after U.S. Steel lost its legal argument in May that the potential $10,000-a-day fines it was facing under the Investment Canada Act were unconstitutional. On Nov. 24, the Supreme Court of Canada announced that it would not hear the company’s appeal of that decision.
U.S. Steel spokeswoman Erin DiPetro said the company was pleased to resolve the “unfortunate dispute” and said the deal “reflects our ongoing and long-term interest in doing business” in Canada. “We intend to be valued corporate citizens in Canada,” Ms. DiPetro said in an e-mailed statement.
In July, 2009, Tony Clement, then industry minister, said Ottawa would take U.S. Steel to court for violating its pledges. But the company argued that it should not have to live up to promises it made before the financial meltdown.
Union leaders had harsh words for the deal announced on Monday. “It’s outrageous that they can be left off the hook like that after causing all the damage they have to the Hamilton economy,” said Rolf Gerstenberger, president of Local 1005 of the United Steelworkers, which represents about 750 workers left in Hamilton and 9,000 retirees.
With a report from Greg Keenan.
http://www.theglobeandmail.com/report-on-business/ottawa-makes-deal-with-united-states-steel/article2268301/
Published Monday, Dec. 12, 2011 3:18PM EST
Last updated Monday, Dec. 12, 2011 7:22PM EST
The federal government has dropped its legal case against United States Steel Corp. for breaking promises to maintain jobs after its 2007 takeover of Hamilton’s Stelco. In exchange, the company pledged to keep producing steel in Canada until 2015 and invest an additional $50-million.
The deal snuffs out a high-stakes court fight between the federal government and the Pittsburgh-based company. But lawyers who advise foreign investors say it sends a signal that Ottawa is serious about enforcing promises made to secure government approval of foreign takeovers.
However, the union representing workers at the two former Stelco mills called the deal a betrayal by the Conservative government.
Industry Minister Christian Paradis announced the agreement in the House of Commons on Monday, saying it was made after the company had approached him and after “extensive negotiations.”
Under the deal, he said, U.S. Steel pledged to keep producing steel in Canada, operate its Lake Erie and Hamilton plants until 2015 and invest at least $50-million in its Canadian facilities by December, 2015, in addition to its original pledge of $200-million by October of next year. The company also pledged to give $3-million to “community and educational programs” in Hamilton and Nanticoke, Ont.
“U.S. Steel’s new commitments, many of which run to 2015, will provide benefits that in all likelihood would not have been obtained through the court process,” Mr. Paradis said.
The deal comes after U.S. Steel lost its legal argument in May that the potential $10,000-a-day fines it was facing under the Investment Canada Act were unconstitutional. On Nov. 24, the Supreme Court of Canada announced that it would not hear the company’s appeal of that decision.
U.S. Steel spokeswoman Erin DiPetro said the company was pleased to resolve the “unfortunate dispute” and said the deal “reflects our ongoing and long-term interest in doing business” in Canada. “We intend to be valued corporate citizens in Canada,” Ms. DiPetro said in an e-mailed statement.
U.S. Steel took over struggling Stelco in 2007, making promises to Ottawa to maintain jobs and steel production at certain levels. But in the face of a worldwide economic crisis two years later, it announced that it was closing both plants, laying off more than 1,500 workers. (The plants later reopened, although they were plagued by labour disputes that ended with lockouts and deep pension concessions.)
In July, 2009, Tony Clement, then industry minister, said Ottawa would take U.S. Steel to court for violating its pledges. But the company argued that it should not have to live up to promises it made before the financial meltdown.
Union leaders had harsh words for the deal announced on Monday. “It’s outrageous that they can be left off the hook like that after causing all the damage they have to the Hamilton economy,” said Rolf Gerstenberger, president of Local 1005 of the United Steelworkers, which represents about 750 workers left in Hamilton and 9,000 retirees.
Lawyers on Bay Street who specialize in the Investment Canada Act disagreed, arguing that the deal actually underlines Ottawa’s resolve to force foreign investors to live up to their commitments.
“This appears to be more than a slap on the wrist,” said Chris Hersh of Cassels Brock & Blackwell LLP in Toronto.
Mark Katz of Davies Ward Phillips & Vineberg LLP said the deal was by no means a surrender from Ottawa: “This is definitely not a backing down by the government. … The message they are sending is that [foreign investors] had better take this seriously.”
With a report from Greg Keenan.
http://www.theglobeandmail.com/report-on-business/ottawa-makes-deal-with-united-states-steel/article2268301/
Obama Agrees to Perimeter Security With Canada to Bolster Trade
By Theophilos Argitis and Andrew Mayeda
Dec. 12 (Bloomberg) -- President Barack Obama and Canadian Prime Minister Stephen Harper agreed to take steps to speed the flow of goods and people across the border while enhancing security and harmonizing regulation, in a bid to counter weakening trade ties between the two countries.
The pact, announced by Obama and Harper following a meeting in Washington, moves the two countries toward a “perimeter” security system that lays out plans to inspect more cargo and travelers before they arrive in North America. Canada and the U.S. will also seek to streamline and align regulations on some goods.
“Moving security to the perimeter of our continent will transform our border and create jobs and growth in Canada by improving the flow of goods and people between our two countries,” Harper said in a statement. “These agreements represent the most significant step forward in Canada-U.S. cooperation since the North American Free Trade Agreement.”
The Canada-U.S. trade relationship has struggled under the impact of tighter border security following the Sept. 11 terrorist attacks, as well as the emergence of China as a competitor and slowing global growth. The share of Canada’s shipments to the U.S. has been declining since 2000, a trend that accelerated as the global recession curbed demand for Canadian exports.
The two countries agreed on 29 initiatives to harmonize regulation as a “first step” toward new regulatory cooperation, focused on agriculture and food, transportation, health products and the environment.
Autos and Rails
Auto producers and rail companies will benefit from efforts to harmonize vehicle safety standards, the Canadian government said in a background document released in Ottawa. Other steps will include developing a common naming system for meat cuts, aligning regulations for pesticides and harmonizing rules in the pharmaceuticals industry.
“This announcement is not about a common border, it is about an integrated economy and our shared vision for good jobs, increased investment and a higher standard of living,” Jayson Myers, chief executive of the Canadian Manufacturers and Exporters, said in a statement.
Border regulations cost Canadian businesses about C$16 billion ($15.8 billion) annually, the Canadian government said.
The accord comes after Obama announced last month he would delay until 2013 a decision on the $7 billion, 1,661-mile (2,673-kilometer) Keystone XL pipeline, proposed by TransCanada Corp. Approval of the pipeline, which would carry Canadian oil- sands crude through the Great Plains to the Gulf of Mexico, is a “no-brainer,” Harper said in a Sept. 21 interview with Bloomberg.
Canada Irked
The Keystone delay is the latest of several U.S. moves that have irked Canada. Canada objected to “Buy American” provisions in the Obama administration’s $447 billion jobs bill that was blocked by Republicans in Congress, as well as the restoration of a $5.50 fee on Canadian travelers arriving in the U.S. by plane or ship.
The two countries have agreed to coordinate their systems for screening cargo so goods entering either nation only have to be cleared once. They plan to integrate passenger baggage screening systems, meaning Canada will have to adopt the U.S. system for detecting explosives. In exchange, U.S. authorities will lift the requirement that baggage be re-screened when travelers switch to connecting flights in the U.S.
Expanding NEXUS
They also agreed to expand a program called NEXUS that allows frequent travelers to pass more quickly through customs. Canada will expand NEXUS lanes and booths at several border crossings, including Windsor, Ontario-Detroit. There will be “significant” investments in physical infrastructure at various border points, the documents say.
Canada and the U.S. will develop coordinated entry-and-exit systems, so the record of land entry by individuals into one country can be used to track the exit from another. Canada will adopt the U.S. exit system, under which airlines must share their passenger manifests on outbound international flights.
Canada will also beef up practices to identify potential terrorist threats before they reach North America, in part by increasing screening of travelers to Canada, and sharing information on high risk inbound travelers.
http://www.businessweek.com/news/2011-12-12/obama-agrees-to-perimeter-security-with-canada-to-bolster-trade.html
Wednesday, 7 December 2011
Obama and Harper split on Keystone XL pipeline deal
7 December 2011 Last updated at 22:20 ET
A controversial oil pipeline linking Canada and the US must be assessed for environmental impact, the US president has told Canada's prime minister.
Meeting Canadian PM Stephen Harper at the White House to sign a border deal, Barack Obama rejected US Republican calls to approve Keystone XL.
Mr Obama had an "open mind" on the project, Mr Harper told reporters, but wanted a full assessment carried out.
The 1,600-mile (2,700km) pipeline would run from Canada to the Texas coast.
"He's indicated to me, as he's indicated to you today, that he is following a proper [process] to eventually take that decision here in the United States, and that he has an open mind in regards to what the final decision may or may not be," Mr Harper said.
'New, modern border'
Canada's prime minister has long backed the Keystone XL plan, which would create jobs in the US and in Canada and enable oil from the Canadian province of Alberta to reach the world market.
But the Obama administration last month delayed a decision on the pipeline until a new assessment of the environmental impact of its route is completed.
That is not expected to be finished until 2013 - after the US presidential election.
Mr Obama, meanwhile, explicitly rejected calls from Republicans in the US Congress to link approval for Keystone XL to Mr Obama's push to renew a soon-to-expire payroll tax cut.
"Efforts to tie a whole bunch of other issues to what's something that they [Congress] should be doing anyway will be rejected by me," Mr Obama said.
In the main business of the day at the White House, the two leaders unveiled a trade deal and perimeter security agreement that Mr Harper said would create a "new modern border".
"Together, they represent the most significant steps forward in Canada-US cooperation since the North American Free Trade Agreement," he said.
The deals would allow easier access to ports and increase harmonisation of security checks and procedures at land borders.
http://www.bbc.co.uk/news/world-us-canada-16081197
A controversial oil pipeline linking Canada and the US must be assessed for environmental impact, the US president has told Canada's prime minister.
Meeting Canadian PM Stephen Harper at the White House to sign a border deal, Barack Obama rejected US Republican calls to approve Keystone XL.
Mr Obama had an "open mind" on the project, Mr Harper told reporters, but wanted a full assessment carried out.
The 1,600-mile (2,700km) pipeline would run from Canada to the Texas coast.
"He's indicated to me, as he's indicated to you today, that he is following a proper [process] to eventually take that decision here in the United States, and that he has an open mind in regards to what the final decision may or may not be," Mr Harper said.
'New, modern border'
Canada's prime minister has long backed the Keystone XL plan, which would create jobs in the US and in Canada and enable oil from the Canadian province of Alberta to reach the world market.
But the Obama administration last month delayed a decision on the pipeline until a new assessment of the environmental impact of its route is completed.
That is not expected to be finished until 2013 - after the US presidential election.
Mr Obama, meanwhile, explicitly rejected calls from Republicans in the US Congress to link approval for Keystone XL to Mr Obama's push to renew a soon-to-expire payroll tax cut.
"Efforts to tie a whole bunch of other issues to what's something that they [Congress] should be doing anyway will be rejected by me," Mr Obama said.
In the main business of the day at the White House, the two leaders unveiled a trade deal and perimeter security agreement that Mr Harper said would create a "new modern border".
"Together, they represent the most significant steps forward in Canada-US cooperation since the North American Free Trade Agreement," he said.
The deals would allow easier access to ports and increase harmonisation of security checks and procedures at land borders.
http://www.bbc.co.uk/news/world-us-canada-16081197
Monday, 5 December 2011
Executives set sights on emerging markets, but Canadians remain cautious: Ernst & Young
Canada NewsWire
TORONTO, Dec. 5, 2011
Global trend of foreign investment is both opportunity and risk for Canada
Nearly 40% of companies worldwide plan to shift some foreign investment from developed to emerging markets within five years, according to the latest Economist Intelligence Unit paper, Canada in a Globalised Economy: An investment perspective, sponsored by Ernst & Young.
This trend has important implications not only for Canadian firms as investors, but also for Canada as a destination for investment
"Emerging markets account for more than half of all global foreign direct investment now, showing a continued upward trend that's likely to continue," says Colleen McMorrow, Ernst & Young's Entrepreneurial Services Leader in Canada, who points to the appeal of a 6% growth forecast for these markets in 2012 compared to only 1.7% in developed ones. "Canadian firms stand to benefit from this trend as investors, but are reluctant to abandon the stability and favourable business environment that domestic and developed markets offer."
The survey, which polled 195 top Canadian and non-Canadian executives, found that 40% of those already investing in developing markets anticipate a 20% or greater boost in foreign-derived earnings this year. At the same time, it shows that not everyone is leaping to follow the trend; 34% of the companies surveyed have no plans to shift their investment from developing to emerging markets in the next five years.
Although Canadian executives are attracted to larger or growth markets to either outsource production or tap fresh markets, they remain more inclined to invest in developed markets, citing concerns about political and economic instability, skepticism about potential returns and workforce challenges in emerging economies.
McMorrow sees value in a thoughtful approach to the opportunities of developing markets, cautioning that Canadian firms looking to invest abroad shouldn't just follow the latest trend or the fastest-growing market. "It's unlikely that Canadian firms will win if they follow the crowd or adopt a 'me too' approach. Expansion to a developing market needs a highly tailored strategy and careful evaluation of the best fit between a firm's unique offerings and product lines and the current and future potential of each market."
Of Canada's own position as a favoured investment destination for expansion by non-Canadian firms, McMorrow says Canadians should not worry about losing their favoured position to developing markets. "You would think this shift should sound alarm bells for Canadians hoping to attract investment from non-Canadian companies, but in fact Canada stands to fare well through an accelerated shift in global economic gravity from the developed to the developing world."
For most survey participants, a favourable business operating environment remains a critical criterion for evaluating targets, giving developed countries like Canada an advantage over developing countries in attracting investors, especially given its ready access through NAFTA to the US market, its stable business environment, its long legacy of welcoming foreign investors, as well as brisker growth than any other G7 country.
To remain competitive, however, McMorrow says, "Canada must continue to be aggressive in branding itself as an attractive investment destination, in actively courting foreign investment, providing a favourable regulatory environment and fostering an entrepreneurial culture." Only one-third of respondents regard Canada as having superior market-growth prospects, and very few respondents, including Canadians, felt it offers a strong entrepreneurial culture.
In a volatile macroeconomic environment, Canada's best strategy is to continue to promote its entrepreneurial potential in order to attract investment, and support the growth strategies of its firms, domestically and globally.
http://www.digitaljournal.com/pr/511865#ixzz1iuvobVeF
TORONTO, Dec. 5, 2011
Global trend of foreign investment is both opportunity and risk for Canada
Nearly 40% of companies worldwide plan to shift some foreign investment from developed to emerging markets within five years, according to the latest Economist Intelligence Unit paper, Canada in a Globalised Economy: An investment perspective, sponsored by Ernst & Young.
This trend has important implications not only for Canadian firms as investors, but also for Canada as a destination for investment
"Emerging markets account for more than half of all global foreign direct investment now, showing a continued upward trend that's likely to continue," says Colleen McMorrow, Ernst & Young's Entrepreneurial Services Leader in Canada, who points to the appeal of a 6% growth forecast for these markets in 2012 compared to only 1.7% in developed ones. "Canadian firms stand to benefit from this trend as investors, but are reluctant to abandon the stability and favourable business environment that domestic and developed markets offer."
The survey, which polled 195 top Canadian and non-Canadian executives, found that 40% of those already investing in developing markets anticipate a 20% or greater boost in foreign-derived earnings this year. At the same time, it shows that not everyone is leaping to follow the trend; 34% of the companies surveyed have no plans to shift their investment from developing to emerging markets in the next five years.
Although Canadian executives are attracted to larger or growth markets to either outsource production or tap fresh markets, they remain more inclined to invest in developed markets, citing concerns about political and economic instability, skepticism about potential returns and workforce challenges in emerging economies.
McMorrow sees value in a thoughtful approach to the opportunities of developing markets, cautioning that Canadian firms looking to invest abroad shouldn't just follow the latest trend or the fastest-growing market. "It's unlikely that Canadian firms will win if they follow the crowd or adopt a 'me too' approach. Expansion to a developing market needs a highly tailored strategy and careful evaluation of the best fit between a firm's unique offerings and product lines and the current and future potential of each market."
Of Canada's own position as a favoured investment destination for expansion by non-Canadian firms, McMorrow says Canadians should not worry about losing their favoured position to developing markets. "You would think this shift should sound alarm bells for Canadians hoping to attract investment from non-Canadian companies, but in fact Canada stands to fare well through an accelerated shift in global economic gravity from the developed to the developing world."
For most survey participants, a favourable business operating environment remains a critical criterion for evaluating targets, giving developed countries like Canada an advantage over developing countries in attracting investors, especially given its ready access through NAFTA to the US market, its stable business environment, its long legacy of welcoming foreign investors, as well as brisker growth than any other G7 country.
To remain competitive, however, McMorrow says, "Canada must continue to be aggressive in branding itself as an attractive investment destination, in actively courting foreign investment, providing a favourable regulatory environment and fostering an entrepreneurial culture." Only one-third of respondents regard Canada as having superior market-growth prospects, and very few respondents, including Canadians, felt it offers a strong entrepreneurial culture.
In a volatile macroeconomic environment, Canada's best strategy is to continue to promote its entrepreneurial potential in order to attract investment, and support the growth strategies of its firms, domestically and globally.
http://www.digitaljournal.com/pr/511865#ixzz1iuvobVeF
Saturday, 3 December 2011
India, Canada sign MOU to boost diamond sector links
By: Bal Krishna
Toronto, Dec 3 (PTI) Leading Canadian diamond exporting organisation Diamond Bourse of Canada (DBC) and the Indo-Canada Chamber of Commerce (ICCC) signed a Memorandum of Understanding (MoU) on Friday night to increase bilateral trade and investment in the diamond sector.
Under the terms of the MoU, both organisations will work together to enhance and create new trade opportunities in the diamond sector by establishing direct links between Canadian producers and Indian diamond manufacturers and eliminating third parties.
At present Canada''s entire diamond output is shipped to Europe, from where it goes to other countries.
DBC Chairman Bhushan Vora and ICCC President Satish Thakkar signed the MoU in the presence of Canadian Immigration Minister Jason Kenney and Consul General of India Preeti Saran at an annual holiday dinner organised by the Indo-Canada Chamber of Commerce.
Both organisations also jointly encourage Indian diamond manufacturers to establish their facilities in Canada and provide guidance and support.
Speaking on the occasion, Jason Kenney said both countries have accelerated efforts to boost bilateral trade and investment and were working closely on a free trade agreement.
Commending the contribution made by the Indo-Canadian community, Saran invited Indo-Canadians to attend the forthcoming Pravasi Bhartiya Diwas in Jaipur in January next year in large numbers.
She also commended efforts by the ICCC to accelerate bilateral trade and investment between the two countries
http://news.in.msn.com/international/article.aspx?cp-documentid=5646392
Toronto, Dec 3 (PTI) Leading Canadian diamond exporting organisation Diamond Bourse of Canada (DBC) and the Indo-Canada Chamber of Commerce (ICCC) signed a Memorandum of Understanding (MoU) on Friday night to increase bilateral trade and investment in the diamond sector.
Under the terms of the MoU, both organisations will work together to enhance and create new trade opportunities in the diamond sector by establishing direct links between Canadian producers and Indian diamond manufacturers and eliminating third parties.
At present Canada''s entire diamond output is shipped to Europe, from where it goes to other countries.
DBC Chairman Bhushan Vora and ICCC President Satish Thakkar signed the MoU in the presence of Canadian Immigration Minister Jason Kenney and Consul General of India Preeti Saran at an annual holiday dinner organised by the Indo-Canada Chamber of Commerce.
Both organisations also jointly encourage Indian diamond manufacturers to establish their facilities in Canada and provide guidance and support.
Speaking on the occasion, Jason Kenney said both countries have accelerated efforts to boost bilateral trade and investment and were working closely on a free trade agreement.
Commending the contribution made by the Indo-Canadian community, Saran invited Indo-Canadians to attend the forthcoming Pravasi Bhartiya Diwas in Jaipur in January next year in large numbers.
She also commended efforts by the ICCC to accelerate bilateral trade and investment between the two countries
http://news.in.msn.com/international/article.aspx?cp-documentid=5646392
Friday, 2 December 2011
Canada Open to Changing Foreign-Takeover Law, Paradis Says
Dec. 2 (Bloomberg) -- Canada is open to changing its law governing foreign takeovers to provide more “certainty” to companies considering purchases of Canadian firms, Industry Minister Christian Paradis said.
“We are always open to improving the regime,” Paradis said today in an interview in New York, where he met with U.S. company executives and investors. “If there are some things we can do to better address this and provide certainty, we will certainly be happy to look into it.”
‘Solid Regime’
Paradis called the existing system a “solid regime” that has worked well. “Our record shows that we’re open to foreign investment,” said Paradis, 37, who took over as industry minister May 18.
Rather than putting the onus on companies, the federal government should have to prove that takeovers aren’t in the national interest, and disclose reasons for rejecting a transaction, the C.D. Howe study recommended.
The federal government reviews foreign acquisitions of companies with assets valued at more than C$312 million ($306 million) under the Investment Canada Act, and can reject transactions that don’t provide a “net benefit” to Canada.
“We are always open to improving the regime,” Paradis said today in an interview in New York, where he met with U.S. company executives and investors. “If there are some things we can do to better address this and provide certainty, we will certainly be happy to look into it.”
Paradis’ remarks come amid calls for changes to Canada’s review process that would make it more transparent. The government last year rejected a proposed $40-billion hostile bid for fertilizer maker Potash Corp. of Saskatchewan Inc. by Australia-based BHP Billiton Ltd.
It was the second time in two years Conservative Prime Minister Stephen Harper’s government blocked a foreign acquisition. In 2008, the government rejected a bid by Minneapolis based Alliant Techsystems Inc. to acquire the aerospace division of Vancouver-based MacDonald, Dettwiler and Associates Ltd. Canada hadn’t previously rejected a foreign acquisition since the Investment Canada Act took effect in 1985.
Harper told Bloomberg News in a Sept. 21 interview that Canada will “proceed with caution” as it considers allowing more foreign takeovers, wanting to ensure they don’t lead to a loss of head office jobs or declining industry leadership.
‘Solid Regime’
Paradis called the existing system a “solid regime” that has worked well. “Our record shows that we’re open to foreign investment,” said Paradis, 37, who took over as industry minister May 18.
Canada’s system for weighing takeovers based on “net benefit” is “highly subjective and unpredictable,” the Toronto-based C.D. Howe Institute said in a study released yesterday. The system, which is more restrictive than in countries such as Australia, may have contributed to the decline in Canada’s share of global foreign-direct investment over the last 30 years, said Philippe Bergevin and Daniel Schwanen, the study’s authors.
Foreign investors must provide evidence to prove their acquisition represents a “net benefit” to Canada, which the industry department evaluates based on factors including impact on employment, productivity and competition, according to the department’s website.
Reverse Onus
Information provided by companies is protected by “very rigid” confidentiality provisions meant to make the process more efficient, the department says.Rather than putting the onus on companies, the federal government should have to prove that takeovers aren’t in the national interest, and disclose reasons for rejecting a transaction, the C.D. Howe study recommended.
Paradis said the government will make a decision “sooner than later” on whether to loosen foreign-ownership restrictions in Canada’s telecommunications sector. The government is also developing the ground rules for an auction of wireless spectrum that may invite bids from companies such as BCE Inc., Telus Corp. and Rogers Communications Inc.
“We want to move quick on this but we want to move correctly,” said Paradis.
The minister called Research in Motion Inc. a “flagship” company that the government wants to ensure has “all the tools it needs” to succeed. He declined to say if RIM, which some investors have said should be broken up or sold, would be considered off limits to a foreign takeover.
http://www.businessweek.com/news/2011-12-03/canada-open-to-changing-foreign-takeover-law-paradis-says.html
http://www.businessweek.com/news/2011-12-03/canada-open-to-changing-foreign-takeover-law-paradis-says.html
Tuesday, 29 November 2011
Ottawa sees wireless prices falling after upcoming call on ownership, auction
Canadians should expect lower prices after Ottawa announces its decision on foreign ownership in the wireless sector and sets ground rules for the next sale of broadband space, Industry Minister Christian Paradis indicated Tuesday.
But, despite wide speculation that Paradis was ready to announce those rules in a speech to an industry convention, the minister said he needed more time to study the issues.
“Some of you may be looking for an early Christmas present today, but I am afraid I am going to be a bit of a Grinch,” he told the conference.
“Given the importance and the serious impact this will have on the lives of Canadians for years to come, this is not a decision that I nor this government will be taking lightly.”
While Paradis did not say directly which way he was leaning, he did say he expected the decisions the government makes will lead to more competition.
“We expect that globally competitive prices for consumers will flow from these fundamentals,” he added.
The minister also said he wants rural customers to receive the same wireless service as those in large, urban centres.
Globalive chief executive Tony Lacavera, operator of the Wind Mobile startup established after the last spectrum auction in 2008, had scheduled a news conference in Ottawa after the minister’s speech.
Lacavera speculated that the government may be divided by intense lobbying from industry players, which have different interests and do not agree on the best way to proceed.
Many analysts had expected the government to announce that smaller players — those with 10 per cent or less market share — would be freed from any restrictions on foreign investment.
They also expected they would receive an effective set-aside in the new auction of 700 megahertz of spectrum. That would make it easier for small and new entrants to bid for spectrum to operate and compete in the sector dominated by Rogers Communications, Bell and Telus.
“If they don’t have a set-aside, we’re going to be forced to fold into one of the new incumbents and you’ll see all the new entrants do the same thing,” said Lacavera.
“We all saw what happened between 2003 and 2008, pricing in Canada rose to the highest level in the world when there wasn’t competitive pricing out there.”
Mobilicity head John Bitove, another new entrant, said in an interview that the government should go ahead with the auction anyway — if it hasn’t made up its on foreign ownership rules — because Canada is falling behind on the desirable 700-MHz frequency, which was vacated by the conversion of television signals to digital.
“The fact is you’ve got four new entrants soon to be five, and we’re all going to need more bandwidth,” he said.
Currently, telecom operators in Canada are restricted to a maximum 46.7 per cent in direct and indirect foreign investment.
Last year, Ottawa announced it was looking at three options on ownership. Removing all restrictions, removing restrictions for small players, or upping the foreign ownership limit to 49 per cent.
http://ca.news.yahoo.com/ottawa-sees-wireless-prices-falling-upcoming-call-ownership-222425054.html
Analysis: Rio Tinto faces new hurdles on Canadian uranium
By Julie Gordon
TORONTO | Tue Nov 29, 2011 12:05pm EST
(Reuters) - Rio Tinto's (RIO.AX) battle to secure its foothold in Canada's uranium-rich Athabasca region has only just begun now that it has apparently won a bidding war to gain control of Hathor Exploration (HAT.TO).
While the path is now clear for Anglo-Australian giant to acquire the exploration-stage company, a whole new set of rules will apply to Rio once Hathor's flagship Roughrider project nears production.
Under current Canadian law, foreign companies are barred from owning more than 49 percent of an operating uranium mine. That could throw a wrench in Rio's (RIO.L) plans to turn Roughrider into a producing asset.
"They have two options," said Salman Partners analyst Raymond Goldie. "Either they hope that the law changes, or they hope that they will find a Canadian partner to own 51 percent."
If it is the latter, that would be good news for Cameco Corp (CCO.TO), Canada's top uranium producer. Even though it backed out of the bidding war for Hathor, the company could end up owning half of Roughrider, located just 25 kilometers (15 miles) from its Rabbit Lake mill in Saskatchewan.
In partnering with Cameco, Rio could comply with ownership restrictions, while gaining access to a mill with spare capacity to process ore from Roughrider, said Goldie.
"I would be willing to make the bet that when the mine comes into production, Cameco will own more than half of it," he said.
But others feel uranium's days as a protected resource in Canada are numbered. The ruling Conservatives have already said they are reviewing the restrictions, and policy experts say the government will likely push to relax the legislation.
"Once upon a time there was a very clear reason for this (restriction), and there was also a climate of concern about foreign investment and foreign ownership in Canada," said Jeremy Rayner, a professor at the Johnson-Shoyama Graduate School of Public Policy at the University of Saskatchewan.
"It looks like an anomaly now," he said.
Canadian uranium first gained notoriety during the Second World War, when it was used to develop nuclear weapons as part of the Manhattan Project. In subsequent years, the government began to restrict uranium to safeguard domestic supply and to ensure it was only used for peaceful purposes. Today, Canadian uranium fuels nuclear power plants around the world.
Easing ownership restrictions on uranium mines would show that Canada is open to foreign investment, say experts, despite a controversial move last year to block a hostile $39 billion takeover of fertilizer producer Potash Corp (POT.TO) by BHP Billiton (BHP.AX), another Anglo-Australian mining giant.
"Both the federal and Saskatchewan governments are right-of-center governments that have declared that they are open for business," said Rayner. "They were, I think, frankly embarrassed by what they had to do with Potash Corp."
Rio's bid for Hathor has cleared the Competition Bureau, but still faces an Investment Canada review, required of all foreign purchases over a certain size. Because its projects are all exploration stage, there are no uranium-specific restrictions on ownership at this time.
BIG IN THE BASIN
While Rio's exact plans for Hathor remain unclear, analysts speculate the miner is using the explorer as a jumping-off point to gain a much larger foothold in the Athabasca basin.
France's Areva (AREVA.PA), which is undergoing a strategic review, could sell some of its uranium assets, including part of its Canadian mining portfolio.
"If the Areva rumors prove grounded, then Rio Tinto may end up with significantly more assets in the basin in short order," wrote Dundee Securities analyst David Talbot in a note to clients.
That could raise some alarm bells with groups that are opposed to foreign ownership of Canadian resources and become a "political hot potato," said Carmen Diges, a natural resources lawyer and partner with Miller Thomson.
"There's an overarching set of views that Canada - being so dependent on natural resource production - how much foreign ownership of our natural resources do we want?" she said.
Rio is already a major player in Canada's mining sector, producing diamonds, iron ore, titanium dioxide and aluminum from projects across the country. Other mining giants like Xstrata (XTA.L) and Vale (VALE5.SA) have taken over Canadian companies in recent years, often in face of public opposition.
But the Canadian government is eager to show it is open to business, and with a friendly deal with Hathor in place, Rio could be ideally positioned to challenge Canada's uranium ownership restrictions.
"Companies, if they want to be strategic players in an area, they'll figure out all possibilities to do that," said Diges. "Laws are a roadmap and creative business people have always been really good at getting to their destination using the road map in new and creative ways."
http://www.reuters.com/article/2011/11/29/us-riotinto-hathor-idUSTRE7AS1RB20111129
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