Alberta rated as best investment climate
British Columbia still in last place
Jason Clemens, Director of Fiscal Studies
The Fraser Institute, Tel: (604) 714-4544
Release date: 26 June 2001
VANCOUVER, BCCanadian investment managers, responsible for over $282
billion in assets under administration, have ranked Alberta as the province
with the best investment climate in the country according to the results of the
2001 Spring Survey of Senior Investment Managers, released
today by the Fraser Institute.
Alberta breaks away from the pack
For the first time since the inception of the Investment Managers
Survey, a single province, Alberta, emerged with the best investment
climate in the country. On a scale of zero to 10, Alberta received a score of
8.6, a full 1.3 points higher than the second place province, Ontario, which
received a score of 7.3. Ontario in turn, is a full 2.0 points higher than the
third place province, Saskatchewan. Alberta's and Ontario's scores have been
similar in previous years.
As was the case in all previous Investment Managers Surveys, most of the
remaining provinces are clustered together. The third place province,
Saskatchewan, scored 5.3 while the last place province, British Columbia,
scored a 4.0.
"The difference between the third-and-last-place provinces is 1.3 points,
the same as between the first-and-second place provinces. This illustrates both
the relatively close performance of most provinces, as well as the
overwhelmingly strong performance of both Alberta and Ontario," says Jason
Clemens, director of fiscal studies at the Institute and co-ordinator of the
British Columbia still in last place
British Columbia has retained its last place position for the last 3 years
of the Investment Managers Survey. This survey was taken before the
recent election, so the results do not include any possible effects of a new
government in British Columbia.
"Consistent with the survey's prediction, BC has performed poorly over the
last decade in attracting investment," explains Clemens.
New Brunswick fell from third position in 2000 to sixth in 2001, while PEI
dropped from seventh to ninth position, showing rather pronounced declines in
their relative investment climates. Quebec, on the other hand, advanced to
fifth from seventh position between 2000 and 2001.
"Interestingly, Quebec is the only province to consistently improve its
investment climate ranking over the last 3 years," notes Clemens.
Economic policies promoting globally-competitive firms
In addition to being asked to rate Canada's respective provincial investment
climates, senior investment managers were also asked whether each provincial
government maintained the necessary economic policies to promote
Positive and Negative Responses
Alberta and Ontario led the nation with 95.7 percent of respondents
indicating that both provinces maintain the policies necessary to foster
globally-competitive companies. Quebec received 52.2 percent positive
responses. Positive assessments for the remaining provinces ranged from 30.4
percent for Saskatchewan to no positive responses for PEI.
British Columbia received the highest level of negative responses; 73.9
percent of respondents indicated that it failed to maintain the necessary
economic policies required to foster globally-competitive firms. Quebec
received the next highest negative score with 43.5 percent of respondents
indicating that it, too, failed to maintain the necessary economic policies for
promoting world-class companies. Negative responses for the remaining provinces
ranged from 39.1 percent in PEI (and 60.9% don't know) to 17.4 percent
Keys to success: taxes, infrastructure, and regulations
A competitive tax regime, including both personal and corporate taxes, the
maintenance of adequate infrastructure, and a proper regulatory environment
were indicated as the path to creating and maintaining a positive investment
Equally clear is that both the provisions of social services by government
and subsidies to business are not important factors in establishing a positive
Minister of Finance's approval drops
The approval ratings for the Minister of Finance, Paul Martin, dropped
slightly from its previous
level of 85%, recorded in the Fall 2000 Survey. In this survey, 83 percent
of survey respondents indicated that the Minister of Finance was doing an
excellent, very good, or good job.
Bank of Canada rating drops
The approval ratings for the Bank of Canada also dropped slightly—to 83
percent from its previous level of 89 percent.
About the Survey
Surveys were mailed to senior investment officers at 130 investment
management firms across Canada. Twenty-six responses were received. The
respondents manage in excess of $282 billion worth of pension assets. Numbers
may not add up to 100 percent due to rounding. Statistical confidence levels
were not assigned to the results.
Established in 1974, The Fraser Institute is an independent public policy
organization based in Vancouver, with offices in Calgary and Toronto.