Canada is launching a quiet but aggressive strategy to lure more foreign investment into the Canadian food sector.
It will offer a combination of public relations and closer scrutiny of incentives being offered in the United States, Canada’s major competitor for investment dollars.
“It is apparent from experience that food executives in the U.S. are in many cases unaware of the competitive advantages of locating in Canada and in other cases myths have been developed about the cost of doing business in Canada,” said a federal-provincial report presented to agriculture ministers in Prince Albert, Sask., last month.
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The federal-provincial steering committee on investment said the government is focusing a pilot public relations program for food company executives in the Chicago area, complete with a package of material on the advantages of producing food products in Canada.
It will try to debunk the view that Canadian companies are noncompetitive because of high costs, high taxes or a small domestic market.
The committee report to ministers said: “In many cases, executives make a location decision without considering Canada as a potential location for food processors.”
It also means Canada is screened out early as companies consider possible locations to spend their money.
Canadian officials also recommend that politicians continue to promote the country’s charms and advantages at international food fairs and on trade missions.
And they have started to track the tactics used by the competition.
A study of investment incentives offered in 26 key American states showed 414 programs that provide tens of millions of dollars worth of help to potential investors.
The programs range from start-up funds and labor cost subsidies to cheap or free land, infrastructure and transportation subsidies.
“The largest group of programs are directed towards labor, some to assist with training, others merely offering assistance if a set level of employment is reached,” said the report.
Start-up incentives and help in acquiring site land also were popular forms of help. They were a combination of expenditures and tax breaks.
The committee said that during the next year, it will try to evaluate the impact these incentives have on attracting investment that might otherwise come to Canada.
It noted the conclusion of a United Nations report on investment that while incentives are not the most important factor in determining where foreign investment in the food industry will go, it can be a factor “especially for projects that are cost oriented and mobile.”
