In his fall economic statement, federal Finance Minister Bill Morneau said things are looking up. In the past year Canada’s economy has grown 3.7 per cent and the projected deficit for this year is $8.5 billion less than the original forecast in March.
It has been a tough few years for Canadians but this statement acknowledges that our fortunes have changed.
Our economy has improved mainly due to a unique set of circumstances that may not carry us ahead in the future. Oil prices have increased significantly and production has come back online since the Fort McMurray wildfires.
For Ottawa to maintain this momentum, and remain committed to its promises to increase child benefit payments, put money in the pockets of low-income workers, and lower small business taxes, we must work together to create a more stable and competitive investment climate.
Despite low commodity prices, oil and natural gas remains Canada’s largest net export industry. We generate more value for the economy than any other sector, including automotive and manufacturing. We cannot grow prosperity for Canada’s middle class without growing our oil and natural gas industry.
Today, the industry employs more than 425,000 Canadians, contributes $113 billion to Canada’s gross domestic product, and supports 24,000 businesses. However, we continue to face regulatory and economic challenges due to evolving and uncertain government policies.
In the past year our country has seen nearly $60 billion in nation-building energy projects fall victim to that uncertainty, such as Enbridge’s $7.9-billion Northern Gateway pipeline, Petronas’ $36-billion Pacific NorthWest LNG project, and TransCanada’s $15.7-billion Energy East Pipeline and Eastern Mainline Project.
As well, Ottawa has placed exploration bans in the Northwest Territories and Nunavut that limit the potential for the economic growth of Northern Canada, and introduced a tanker ban on British Columbia’s north coast cutting off a vital trade route to new energy customers in Asia.
"In the past year our country has seen nearly $60 billion in nation-building energy projects fall victim to that uncertainty."
The world’s need for energy is only increasing. The International Energy Agency predicts global energy demand, due to an increasing middle class, will rise 31 per cent by 2040 with India and China leading the way.
In its 2017 Crude Oil Forecast, Markets and Transportation report, the Canadian Association of Petroleum Producers anticipates oil production in Canada will grow to 5.1 million barrels per day by 2030 from 3.9 million bpd in 2016.
We have the energy the world needs. If we’re going to be a part of the world’s energy future we need to be able to compete, while continuing to be a source of economic security for Canadians.
We can be the world’s energy supplier of choice, and still generate economic and environmental benefits in Canada – but only if Ottawa develops our natural resources with competitive policies that attract investment and spur innovation.
Ottawa can help by enabling the right fiscal framework that encourages innovation to enhance environmental performance. We need an accelerated capital cost allowance for clean-technology investments in our oil and natural gas sector.
Knowing our country currently has the fastest-growing economy among the G7 nations is good news, but unless we take measures to ensure a sustainable future for generations to come our success could be fleeting.
It’s time our nation began recognizing the importance of oil and natural gas to our collective prosperity and security, and show support for an industry that supports Canada.
Our future depends on it.
This opinion-editorial was published in The Globe and Mail on October 26, 2017.