Posted on January 1, 2017
Chief Policy Officer of the Business Council of British Columbia
Don Newman: There are a number of factors that make British Columbia one of Canada’s many “distinct societies.” Which ones stand out for you?
Jock Finlayson: I think B.C. differs from the other parts of the country in a number of respects. We are a coastal province that looks to Asia-Pacific increasingly, towards where our future lies. Immigration, which is having a big effect on Canada as a whole, has played out in a particular way for British Columbia. We are attracting overwhelmingly newcomers from Asian countries—particularly from China, but also from the Philippines and India and some other nations in Asia. So the population is increasingly made up of people of Asian descent to a greater extent than elsewhere in Canada.
DN: And on the political climate, does the fact that one of the two main parties is very far to the left of centre cause uncertainty in the business community?
JF: It has historically. We have had quite polarized politics of left and right, all with a populist tinge. So when governments have changed in British Columbia, we have tended to see bigger swings in economic policy direction than in the rest of
Canada. I think that’s now dissipated to some extent.
Part of it is due to the fact we’ve had the same party in power now for 16 years. One quarter of the population in B.C. is now foreign born, and there has also been a lot of migration of people from elsewhere in the country. Those newcomers don’t necessarily bring with them the traditional B.C. mindset when it comes to politics.
The environmental movement is very strong in the province, and that tends to shape the political thinking of a lot of people in government and politics, whatever their stripe. First Nations issues, unresolved indigenous land claims, the fact that indigenous communities are playing a much bigger role in resource development and economic development generally—that’s quite a new phenomenon. I’d say within the last 15 or 20 years it has had a big impact on the thinking of business and on certain government priorities.
So the traditional kind of left-right cleavages which I think the rest of the country would associate with B.C., I do think they’re fading.
DN: But I think you probably touched on a big issue: Indigenous participation in the economy. You talk about First Nations’ role in resource development but some people might see it as resource non-development. They’ve been opposed to pipelines, shipping terminals and other projects.
JF: I think that is the perception outside of the province. Historically, we never had treaties in place between First Nations and the Crown. We only have a handful of those today, so the vast majority of B.C. First Nations do not have any kind of treaty arrangement in place. That has created a more complex kind of backdrop for land-based economic activity. These indigenous groups that don’t have treaties have made claims to certain portions of land and certain amounts of natural resources, all of which have to be sorted out.
It does create uncertainty and complication. But it’s not true that First Nations generally are opposed to resource development or infrastructure development, nor is it true that they all have the same perspective on these matters. There’s often quite a bit of First Nations’ support for those undertakings, and increasingly they have a direct role in resource and infrastructure development in some cases as equity partners and in other cases through economic benefit agreements.
DN: I want to ask you about foreign investment, particularly in the B.C. real estate market.
JF: The controversy we’ve seen in B.C. is focused on offshore investment flowing into the residential real estate market. We’re not seeing much concern about foreign companies investing in resource projects or hotels or any number of major office buildings in downtown Vancouver.
The focus of public attention and political attention has been squarely on the substantial inflows of offshore money into residential real estate. Has it played a role in driving up prices? There’s no question about that.
At least 10 per cent of all property purchases in the metro Vancouver area, until recently, were being made by so-called foreign purchasers. That came to well over a billion dollars a month until very recently.
It’s not the only thing pushing up prices because we’ve had low interest rates and constrained land supply and population growth for a long time in Vancouver.
DN: How important is it to British Columbia that the Trans-Pacific Partnership be ratified and go ahead?
JF: It’s certainly important to Canada and British Columbia. The province has supported Canadian participation in the TPP. We would like to see it approved by Parliament. The TPP is probably the most advanced multilateral trade agreement out there. It’s state of the art, in terms of the architecture of it.
It also would link Canada with countries that are part of the fastest growing part of the global economy —namely, the Asia-Pacific Rim economies. It would give us improved access to the Japanese market; that’s something that we don’t have at the moment. Japan’s still the third largest economy in the world and still Canada’s third largest trading partner.
If there is no TPP, I think you’ll see the government looking at bilateral options with India, China and Japan, in particular.
DN: Thank you very much, Jock.