Category: Economic World News

First in a three-part series on how Canada’s heavy regulatory burden is choking competitiveness.

Ask Jean-Francois Boursier about running a business under Canadian regulations and he will likely tell you a tale of two paint shops.

ADF Group Inc., where Boursier is chief financial officer, needed to build identical painting facilities on either side of the border: one at its steel fabricating plant in Terrebonne, Que., and the other in Great Falls, Mont.

The approval process for the Montana project kicked off in 2016 and it was authorized a year later. The Quebec shop was a different story.

“Between the time we started and the time we ended up with our final environmental permit was about two years,” Boursier said. “These are twin paint shops — the two of them, identical, built at roughly the same time. I’d say we paid between a half-million and a million dollars more in Quebec on a $9-million investment. That’s not counting the frustration.”

Much of the recent debate about Canada’s competitiveness has focused on whether Ottawa should chase U.S. corporate tax reductions by slashing its own rates. But Boursier’s tale illustrates a less often considered, but growing concern about their respective regulatory frameworks — the mass of government rules that protect the public when they’re working well, but unnecessarily hinder business development, supply chains and operations when they’re not.

“Canadian businesses have a very legitimate issue on tax competitiveness, but we don’t just compete on taxation right? We also compete via regulation,” said Craig Alexander, Deloitte Canada’s chief economist. “And in Canada, we have significant areas where regulation is impeding competitiveness.”

Fixing those regulations is a longstanding problem that some say assumed greater urgency after U.S. President Donald Trump introduced a package of measures he touted as “the most far-reaching regulatory reform in history.”

One of Trump’s first actions as president was to establish a “one in, two out” policy, ordering agencies to cut two regulations for every new one introduced, and to offset the cost of that new regulation. The U.S. also created reform task forces in all federal departments charged with evaluating existing rules and making recommendations regarding their repeal, replacement or modification.

The resulting cuts have saved US$23 billion in costs, according to the White House’s Office of Management and Budget.

Yet many of Trump’s regulatory rollbacks — particularly those that weaken protections for wildlife, air quality and groundwater supplies — have raised grave concerns about the long-term impact on the public.

“If Trump’s regulations are harmful to the public interest, it might not be the case that you want to match them, because they aren’t necessarily where Canada wants to go,” said Alexander, who points to the 2008 financial crisis as a “great example” of where weak U.S. regulations contributed to a major economic catastrophe.

“But that doesn’t mean there aren’t things we should be trying to do, because when you take all the different sources and put them together, you get a picture that says Canada is facing a real challenge on regulatory competitiveness,” he said.

Indeed, Canada this week fell four spots to No. 22 on the World Bank’s latest Ease of Doing Business Index, which measures the impact of regulations in 190 economies in the Organisation for Economic Co-operation and Development (OECD).

Dig a little deeper and the drag becomes clear: Canada compares well in terms of access to credit and the ease of starting a business, but its performance takes a steep decline to No. 63 in terms of “dealing with construction permits” and No. 50 in “trading across borders.”

Similar concerns surface in the World Economic Forum’s 2018 global competitiveness index. Despite an overall 12th place ranking on favourable views of Canada’s labour market and macroeconomic stability, the country plunges to No. 53 when it comes to the “burden of government regulation,” down from No. 38 the year before.

Canada is facing a real challenge on regulatory competitiveness

Craig Alexander, Deloitte Canada’s chief economist

One of the key challenges in reshaping Canada’s regulatory regime stems from the way rule-making powers have been distributed between federal and provincial governments.

Unlike the U.S., where more power is held at the federal level, Canada’s status as a federation means regulatory control is spread between Ottawa and the provinces. That dynamic makes Canada’s key regulatory challenges — including the removal of inter-provincial trade barriers — and the remedies required to fix them particularly tricky, analysts say.

Decades of provincial rule-making have created a “tyranny of small variances” in regulations that affect trucking standards, food packaging and labelling, trade in beer and wine, and securities regulation, according to a May report by the Canadian Chamber of Commerce.

For trucking companies, Canada’s cross-country patchwork of rules governing permissible weights, speed limitations and driver hours complicates operations and denies companies a level playing field, said David Carruth, chief executive of Milton, Ont.-based One for Freight and incoming chair of the Ontario Trucking Association.

For example, rules regarding the number of hours a driver can stay on the road without stopping to rest differ between Ontario, Alberta and Saskatchewan, he said. Furthermore, Ontario and Quebec require licensed trucks to have “mandatory speed limiters” — devices that restrict speeds to 105 km/hr — while other provinces do not.

“Mandatory speed limiters are safer, better for fuel consumption, better for carbon emissions,” Carruth said. “But we’re competing with carriers in other parts of the country and in the U.S. who don’t have speed limiters on their trucks. There’s a lot of good rules there, but we need a national standard.”

Scrapping or streamlining such differences could be a game changer for the economy since internal trade accounts for almost a fifth — or $370 billion — of Canada’s annual GDP.

Removing barriers could boost annual output up to two-tenths of a percentage point, according to Bank of Canada estimates — about as much as is expected to result from the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

A “harmonize or justify approach,” in which provinces must explain why their standards need to be different, is one way to “hold feet to the fire” and address issues of regulatory duplication and overlap, said Grant Bishop, associate director of research at the C.D. Howe Institute.

Harmonization between our provinces on regulatory standards is the real way to unleash Canadian competitiveness

Grant Bishop, associate director of research at the C.D. Howe Institute

“Harmonization between our provinces on regulatory standards is the real way to unleash Canadian competitiveness, with the federal government ideally playing a supportive, but assertive role to bring that competition together,” he said.

Governments and businesses broadly agree on the need to ease the regulatory burden, particularly at a time when rising trade barriers are creating new challenges for businesses.

The federal government announced a “one for one” regulatory rule in 2015 — in which one rule must be removed for every new one introduced — and will hold a first ministers meeting in late November or early December that will focus on easing internal trade barriers.

Federal, provincial and municipal governments also ratified the Canadian Free Trade Agreement (CFTA) last year in an attempt to resolve inter-provincial differences, though analysts and business groups say progress has been slow.

“Without strong top-down leadership pressure, we remain skeptical that officials and regulators will on their own through this agreement achieve significant action,” said Ryan Greer, lead analyst on regulatory issues at the Canadian Chamber of Commerce.

“It’ll take a lot of pressure from the provinces and the prime minister to take advantage of this new tool and show the business community that things will be different this time. We think it’s positive it’s happening, but what matters is what comes after.”

Getting Canada’s regulatory house in order would add a degree of clarity for domestic businesses as well as for international investors, who are already grappling with foreign investment rules that have been a “great point of uncertainty for competitors entering the Canadian marketplace,” Bishop said.

For instance, Canada imposes unusually strict ownership restrictions on sectors such as telecommunications and banking compared to international standards, according to an OECD survey. The Investment Canada Act is also unusual among countries in that it requires foreign investors to show a “net benefit” to the country when buying a domestic company.

Various incidents this year — including the decision to halt the purchase of Aecon Group Inc. by a Chinese state-owned entity and the upheaval surrounding the Trans Mountain pipeline — have led to calls for more transparency on foreign direct investment rules and the government’s duty to consult Indigenous peoples.

“Instead of having companies prove a net benefit, I’d like to have a world where government has to show net harm to the economy,” Alexander said, noting that clear policies on investments by state-owned enterprises are also required. “If we could clear up that, we might actually make it more attractive for companies to look at Canada and say, ‘Boy, that’s a place I’d like to invest.’”

Organizations such as the Canadian Chamber of Commerce point to international examples for inspiration on how to turn things around.

For example, Denmark’s Business Forum for Better Regulation — a group of industry, labour and professional organizations assembled in 2012 — is charged with suggesting rule changes that the government must either accept or give reasons for refusing.

Instead of having companies prove a net benefit, I’d like to have a world where government has to show net harm to the economy

Craig Alexander

By 2016, the Danish government had adopted 308 recommendations, either fully or partially, for savings of $168 million, according to an OECD report.

Others say reforming regulations begins with the fundamental task of improving the collection of data necessary to identify cases of regulatory overlap and duplication.

Introduced in 2014, the federal government’s Administrative Burden Baseline (ABB) requires governments to establish a count of the number of regulations imposed on business.

But the number of regulations is only part of the picture for Canadian businesses. The ABB does not provide information on the intensity of those burdens or how they correlate to rules issued at other levels of government, analysts say.

“If you can’t measure it, you can’t reduce it,” Greer said. “There’s no magic bullet, of course, but any political effort to reduce regulatory burden has to start with a measure of what’s actually there. Otherwise, that cumulative burden just builds up.”

Financial Post

• Email: npowell@nationalpost.com | Twitter: naomi_powell

Canada Goose Holdings Inc. is slowly expanding beyond its parka roots, entering the footwear realm on Thursday with a $32.5 million acquisition that comes as it continues to grow its roster of flagship stores around the world.

The deal to acquire Baffin Inc., which will see the Ontario-based winter-boot maker continue to operate as a standalone entity, is part of a transition that CEO Dani Reiss says has seen the company — which found international renown with its extravagantly priced, Arctic-proof parkas — morph into a full-fledged “three-season lifestyle brand.”

“Lots of companies that have a little bit of brand velocity just start making all kinds of stuff and throwing their logos on it,” Reiss said. “Personally, I believe that’s the way to ruin a brand. We don’t do that…. We make best-in-class products and this is an opportunity to buy best-in-class technology and use it for our own footwear line.”

Footwear will eventually join a widening roster of offerings that already includes a number of lighter weight products, such as rain gear and knitwear.

That means, as the company eyes new locations for expansion, it won’t be confined to desperately cold places, Reiss said.

That expansion will take its next step on Friday, when Canada Goose opens a flagship store in temperate Vancouver, to be followed by others in Montreal and Beijing before the holiday shopping season begins in earnest.

The Beijing store comes after the opening of a Canada Goose flagship in Hong Kong last month, and the opening of a Shanghai regional office and a China e-commerce sales partnership through through the Alibaba Group. Since its wildly successful initial public offering last year, Canada Goose has been focused on its entrance into China while continuing to grow its retail stores.

“We’ve built this brand by doing things that other people aren’t doing,” Reiss said. “Now, in these times, more often than not, brands are closing stores … There’s this so-called retail apocalypse.

“To be able to be in a situation where we’re opening stores in this kind of landscape … that’s just another example of how, even as a larger company, we can continue to swim upstream.”

The push to open news stores started in 2016, with the goal of opening up to 20 locations by 2020 – a target Reiss said Canada Goose is on track to meet with stores currently in Toronto, New York, London, Chicago, Boston, Calgary, Tokyo and New Jersey. Next, Reiss said, he sees more “geographic opportunities” in the U.S. and Europe, as well as more in China and Canada. But he wouldn’t say where.

“If you had to guess the list, I think you’d probably do pretty well,” he said. “I won’t rule out hot climates. But we have a long list of cities that we’d like to be in and we want to do it very carefully and methodically.”

To be able to be in a situation where we’re opening stores in this kind of (retail) landscape … that’s just another example of how … we can continue to swim upstream

CEO Dani Reiss

But that kind of expansion can’t be without complications. Asked if there were challenges to growth in China, Reiss said “there’s a lot of bureaucracy in China that you have to be prepared to deal with.” The expansion could have also riled the giant department store chains that are his wholesale partners, upset with the prospect of competing with Canada Goose store in certain markets. But that didn’t happen, Reiss said.

“If you asked them, ‘Would you rather if Canada Goose opened a store or not?’ They’d say no. And that’s natural, right?” he said. “But not even! That’s not even true, entirely. Because, you know, flagship stores for global brands are common and really help elevate the brand both in global and local markets. So no, we really have experienced little pushback.”

Reiss, who two decades ago took over the family business his grandfather started in the 1950s, has become an ardent protector of the Canada Goose brand. To date, he said, he has inspected each location before signing the lease and visits each store on an annual basis.

“Depending on how many stores we have, one day I might not be able to do that,” he said. “But we’ll take that one day at a time, or one year at a time, or one month at a time or something like that.”

Second in a three-part series on how Canada’s heavy regulatory burden is choking competitiveness.

CALGARY – Enerplus Corp. chief executive Ian Dundas has not “written off” Canada as a place to do business, but he is not planning to shift spending back to the country from the U.S. anytime soon.

“We’ve transitioned our business into the U.S. — dramatically transitioned it,” he said. “This year and next, we will spend 90 per cent of our capital in the United States.”

Dundas said Enerplus’s capital budget was once more weighted toward Canada, but the company in 2015 started shifting its capital to the U.S.

“When you hear ‘capital,’ the synonym for that is ‘jobs,’” he said, adding that Enerplus has staffed up considerably in the U.S. in recent years. Annual disclosures show the company employed 139 people in the U.S., compared with 265 people in Canada at the end of last year.

Dundas and other oil and gas executives point out that U.S. regulatory processes are more predictable and streamlined, its regulations change less frequently and it takes less time to get regulatory approvals to develop a resource, which has led the industry to become increasingly critical about Canada as a jurisdiction to drill for oil and gas and less likely to invest here.

They also point to reports such as the World Economic Forum’s Global Competitiveness Index ranking, which was updated on Oct. 16. Canada fell two places and is now the 12th most competitive jurisdiction in the world.

The WEF ranked the U.S. first overall, which oil and gas executives say is significant because it has become Canada’s main competitor for investment dollars in the energy industry — a trend that Dundas called a “massive change that changed everything.”

Capital spending in the U.S. oil and gas sector rose 38 per cent to $120 billion last year, Reynold Tetzlaff, PricewaterhouseCoopers LLP national energy leader, said in an email, citing data compiled by the Fraser Institute.

“The U.S. is more competitive in the oil and gas market today,” he said.

Now, Canadian-domiciled oil and gas producers are getting more vocal about the issue.

The U.S. is more competitive in the oil and gas market today

Reynold Tetzlaff, PricewaterhouseCoopers LLP national energy leader

“There are four key challenges facing the oil and natural gas industry: market access, regulatory effectiveness, cost structure and fiscal competitiveness,” Canadian Natural Resources Ltd. said in an emailed statement.

CNRL is Canada’s largest upstream oil and gas producer with daily production exceeding one million barrels per day, or more than 20 per cent of the country’s total production.

“It is imperative that we maintain our high regulatory and environmental standards while also overcoming these challenges,” the company said.

Federal Finance Minister Bill Morneau has said Ottawa is tracking Canadian business competitiveness and regulatory burdens relative to the U.S., which also has the advantage of getting recent major tax cuts. But his government has not announced any changes yet.

As it stands, the energy industry blames a combination of provincial and federal governments for what they call “duplicative” and incremental regulations that hurt business competitiveness without improving environmental stewardship.

This month, staff from Environment and Climate Change Minister Catherine McKenna’s office flew to Calgary to meet with chief executives from major pipeline and oilsands companies and listen to criticism about Bill C-69, which would reorganize the National Energy Board and establish a new assessment agency, to die on the order paper.

Caroline Theriault, an Environment and Climate Change spokesperson, said the government will continue to meet with stakeholders in the energy sector and that “Bill C-69 is supported by many in the resource sector across the country.”

But industry executives say the legislation will further stymie investment in the resource sector by introducing new and unpredictable regulatory reviews, and prevent new pipelines from being built in the country. They have repeatedly stated they want Bill C-69, currently before the Senate, to die on the order paper.

In addition to new pipelines, PwC’s Tetzlaff said the energy industry needs to see a Canadian response to the U.S.’s tax reforms and efforts to streamline the regulatory processes.

“We need to utilize all of these components to regain our edge as an energy leader,” he said.

It already takes weeks longer to get well licences in Alberta than in places such as Texas, according to a report published in September by the Canadian Association of Petroleum Producers, the industry’s largest advocacy group.

The report noted that oil and gas companies wait between 79 and 119 days for a routine well licence in Alberta, compared to between 30 and 60 days in Texas. For non-routine well applications, or applications for which “statements of concern” are filed by interveners, the timelines in Texas can be up to 190 days shorter.

The report was particularly critical of the regulatory process in Alberta, where it can take up to six years to get approval for a steam-based oilsands project.

“What we should strive for is a streamlined and efficient regulatory system that maintains the standards that Canadians expect,” CAPP chief executive Tim McMillan said.

He said CAPP and several individual companies have been meeting with politicians about the issue for years, but “over the last few years, it has gotten worse.”

For example, McMillan noted Mick Mulvaney, one of U.S. President Donald Trump’s cabinet members and the director of the Office of Management and Budget, has asked all other U.S. federal government departments to put forward plans to streamline their regulatory processes.

“You see the results,” he said. “Capital growth in the U.S. oil and gas industry is up almost 40 per cent this year. In Canada, it is declining.”

The Alberta Energy Regulator, which oversees oil and gas activity in the province, disagreed with some of the timelines CAPP highlighted in its report.

“The AER posts estimated application processing times on its website and meets the targets more than 90 per cent of the time,” spokesperson Monica Hermary said in an email.

Capital growth in the U.S. oil and gas industry is up almost 40 per cent this year. In Canada, it is declining

Tim McMillan, CAPP CEO

She added that longer timelines could arise from complex development or factors that are outside the regulator’s control, “including if the application is incomplete or if stakeholder consultation requirements have not been met.”

Hermary said the AER is working with the energy industry, including CAPP, “to gather input on how to make the regulatory system more efficient and the areas we need to focus on that will make a positive difference.”

But for producers that have already shifted their capital spending to the U.S., it will be difficult to draw them back without major changes.

Enerplus’ Dundas said the company has now developed assets in the U.S. as a base for future growth rather than in Canada.

“Our assets today in Canada do not support a shift back,” he said.

• Email: gmorgan@nationalpost.com | Twitter: geoffreymorgan

When news broke earlier this year that the accounts of maybe 600,000 Canadian Facebook users had been compromised, Ottawa swung into action to shut down this alarming example of creeping surveillance capitalism. Scott Brison, then acting minister of democratic institutions, said his government had dispatched Canada’s national spy agency to make sure the privacy of Canadians had not been compromised. “Social media platforms have a responsibility to protect the privacy and personal data of citizens,” said Brison.

But when news broke last week that Statistics Canada wants to expand its inventory of data on Canadians by collecting real hard-core personal information on the banking activities of 500,000 Canadians annually, the Trudeau government was suddenly not at all concerned about privacy breaches or even the principle of privacy protection. Instead of waving a red flag over the prospect that StatCan would end up with computers full of private financial details on millions of citizens, Prime Minister Justin Trudeau brushed off privacy concerns, which he implied take a back seat to the government’s need for “high quality and timely data.” Such data, he said, are “critical to ensuring government programs remain relevant and effective for Canadians.”

Spoken like a true central planner and enthusiastic purveyor of policy-based evidence making. Nobody seems to know why StatCan wants to begin collecting personal banking information on individual Canadians, information that Canada’s bankers are rightly reluctant to provide. In the all-new era of fintech and blockchain, the great concern among regulators is how data privacy will be protected. At StatCan, the concern is: “How do we get our hands on the data?”

An official tweet Wednesday from Anil Arora, Chief Statistician of Canada, failed to clarify the agency’s motives. He called the bank data collection plan a “pilot project.” He said more than 75 per cent of Canadian consumer purchases are conducted online and that StatCan “has to have access to these data in order to provide all Canadians with the timely and quality statistics they need in areas such as housing and debt and the impacts of transitioning to a GIG economy.”

The gig economy? Is that an economic phenomenon big enough to justify the  accumulation of personal banking transactions of most of the population? As for the consumer purchases of Canadians, online or otherwise, credit card data might be more informative, although one hopes StatCan has not gone after that data as well as the credit bureau information it has surprisingly already collected.

StatCan’s assurances on privacy protection are not all that reassuring. In a document dated October 2018 — obtained by David Akin at Global News— the chief statistician describes his agency’s “Generic Privacy Impact Assessment related to the acquisition of financial transactions information.” It is clear that the names of millions of Canadians, their bank account numbers and transactions, their bill payments and personal activities, will be collected and stored in government computers. StatCan is not merely getting useful generic data on the spending and banking habits of Canadians, it is collecting the actual spending and banking habits and names of individual Canadians.

It is one thing to collect and analyze statistics based on anonymous data. It is quite another to “require” — Arora’s word — that the banks provide “individual payments and income history.” Even though billions of bits of private, individual and personal information will be collected, StatCan says that, “Under no circumstances will the personal information obtained from financial institutions be used to perform credit, expenditure or income checks on individual Canadians.” He said none of the resulting statistical reports will include any personal data.

That’s not good enough.

There are two larger issues here, aside from the obvious breach of individual privacy without permission and the fact that detailed day-to-day banking information on Canadians is a much more deeply personal than daily Facebook activities.

The first issue is security. StatCan says billions of bits of personal data will be collected using a “secure file transfer protocol” and stored behind “network firewall and access rules” with “functional and current anti-virus software.” Only people with “work-related need” will have access. All very nice, but we’ve heard all this before from any number of corporations and government agencies that have suffered data breaches.

It is one thing to collect and analyze statistics based on anonymous data. It is quite another to ‘require’ that the banks provide ‘individual payments and income history’

The second and more important issue is the use to which the data will be put, not just today but in the future. StatCan itself has in the past shown a willingness to jump aboard political trends. It is famous for cranking out research on the 1% wealth gap, income distribution and pay inequities. It jumped aboard the marijuana bandwagon with a “Cannabis Stats Hub” which seemed to be promoting a booming industry and a Liberal agenda.

StatCan’s explanation of its current objectives are already vague. But a decade or two from now, some new interventionist government with bold planning ideas and a fresh ideological agenda could decide to dig deeper into the personal banking data storehouse.

Politics is filled with planners and interventionists whose need for more data is universal and never-ending. In future, current privacy rules — such as they are — could easily be overthrown in the name of the public interest.

In this internet era of Big Data, there are constant warnings about the risks of “surveillance capitalism” through the likes of Google and Facebook. The greater risk has always been surveillance statism.

Kudos to Canada’s Privacy Commissioner Daniel Therrien for launching an investigation into Statistics Canada’s bank data raid.

Third in a three-part series on how Canada’s heavy regulatory burden is choking competitiveness.

My first idea for a column on domestic protectionism and over-regulation was to detail all the ridiculous ways that Canada’s federation makes life impossible for executives. For example, an employer with a 10-province and three-territory strategy would have to order eight different first-aid kits to stay on the right side of various labour laws. There’s plenty more where that came from. Almost half of the 345-page Canadian Free Trade Agreement that was agreed to last year is devoted to exemptions.

But that take would have been inaccurate. Life isn’t impossible

for Canadian companies and the international firms that do business here, it’s just frustrating and inefficient. Canadian corporations earned more than $100 billion in the second quarter, an eight per cent increase from a year earlier. Capitalism lives, despite the best efforts of 14 sets of rule makers to strangle it.

Make no mistake: the regulatory thicket between the provinces and territories is holding us back. A Senate Banking Committee report in 2016 said internal free trade would increase gross domestic product by as much as $130 billion, and by at least $50 billion. However, that is an “opportunity cost,” so it doesn’t show up in hard data, with the possible exception of Canada’s notoriously woeful productivity numbers.

On the other hand, provincial finance ministers know exactly how much revenue they can expect from their various monopoly companies and regulatory fees. “The revenue aspect is an important factor,” Joseph Day, the New Brunswick senator who co-wrote the banking committee’s internal-trade report, said in an interview Friday.

The result: inertia.

Canada may have dropped to No. 22 on the World Bank’s annual Ease of Doing Business rankings in 2018, but that’s still higher than Germany (No. 23), and there is probably little risk of significant capital flight to the former Soviet republic of Georgia (No. 6) or Lithuania (No. 14).

So executives cope. Fresenius Kabi, a German pharmaceutical company, waited six months as various approvers looked over the company’s new $11-million compounding facility in Mississauga, Ont. Still, Matthew Rotenberg, chief executive of the company’s Canadian unit, said he didn’t mind.

“Mississauga walked us through it,” he said in an interview this week. “On balance, (the process) met our expectations.”

Nor was Rotenberg bothered by having to satisfy the requirements of 10 provinces. The new plant was built in anticipation of demand from hospitals that would rather outsource their custom medicine preparations than upgrade to comply with new national standards.

The provinces, of course, will adapt the federal mandate to their own circumstances and at varying speeds. I would find that frustrating, but for Fresenius Kabi, it’s just the way things are. “Everyone is looking ahead,” Rotenberg said of his various regulators.

The unwillingness of executives to join the debate over regulation makes it hard to launch a proper campaign for change.

The free-market think tanks behind the One Market, One Country campaign sponsored a conference in Ottawa on Oct. 31 to focus attention on the issue. The quality of the debate was excellent, but no actual job creators took part. Their absence meant the discussion lacked authenticity.

The head of the British Columbia wine lobby cracked a good joke about how he would have liked to have brought some good bottles from the Okanagan Valley, but doing so would have risked jail time. The joke would have been even funnier if Canadian taxpayers weren’t currently on the hook for the defence of B.C.’s possible discrimination of U.S. wine imports at the World Trade Organization.

The unwillingness of executives to join the debate over regulation makes it hard to launch a proper campaign for change

The business lobbies talk a good game on internal-trade barriers, but they often are as conflicted as the politicians, because some of their members benefit from local barriers.

To be sure, the leaders of the oilpatch have become extremely vocal about Canada’s inability to build pipelines, but they waited until the situation became extreme before speaking out. As we were reminded last summer when entrepreneurs freaked out over losing the right to sprinkle their incomes among family members, most executives only engage after they’ve lost something.

That’s why a Bloomberg News interview this week with Paul Desmarais III stood out. The scion of the family behind Power Corp. said financial technology companies in Canada have to deal with too many regulators that are too stretched to deliver timely decisions. The risk is that dozens of companies with lots of potential never get off the ground.

“A six-month delay for a certain fintech can mean life and death,” said Desmarais, who oversees Power’s investments in the emerging industry, which include a stake in robo-adviser Wealthsimple Financial Inc.

Politicians say they are motivated to do something about internal trade.

The mandate letter that Prime Minister Justin Trudeau wrote for Dominic Leblanc orders his new intergovernmental affairs minister to “collaborate with provinces and territories to eliminate barriers to trade between each other, and work toward a stronger, more integrated Canadian economy.”

Trudeau also plans to assemble the premiers before the end of the year to work on freer trade within the federation. There appears to be support for the idea from a couple of the prime minister’s harshest critics, Doug Ford and Scott Moe, the Conservative premiers of Ontario and Saskatchewan, respectively, who said on Oct. 29 that they would seek to eliminate rules that impede trade between their two provinces.

“I hear from business leaders that this is one of the primary obstacles to attracting new investment and jobs to our country,” Ford said.

… Trudeau and the premiers likely would agree to erase barriers to the exchange of beer and wine. That would be a start. The risk is that it also would be an ending

Those business leaders should follow the lead of Desmarais and speak for themselves.

Darrell Dexter, the former New Democratic premier of Nova Scotia, told the One Country, One Market conference that Trudeau and the premiers likely would agree to erase barriers to the exchange of beer and wine. That would be a start. The risk is that it also would be an ending.

Day doesn’t sense there is any more political will to make tough decisions today than there was two years ago when the Senate banking committee published its report.

“It’s going to take some goodwill,” he said. “The federal government is going to have to come up with some significant incentives.”

The other alternative might be going back to the well of support the Trudeau government used in order to survive the renegotiation of the North American Free Trade Agreement. The same economic arguments apply, and better access to provincial markets could be a hedge against Donald Trump’s penchant for trade wars.

But Canadian executives are going to have to show they want it.

•Email: kcarmichael@postmedia.com | Twitter: CarmichaelKevin