Many Canadian firms are losing their optimism about the Canadian economy, believing that the country is becoming a less competitive place to invest in.
According to a Chartered Professional Accountants of Canada (CPA Canada) poll, which questioned professional accountants in leadership positions, optimism in the opening quarter of the year slumped from 48% to 34%, the lowest level of positive outlook since 2016.
Roughly two in three of the respondents claimed that Canada is now a less competitive place to invest and do business in, seeing the United States as a more viable region to be in.
For these respondents, the three major challenges to the Canadian economy are the US trade protectionism, uncertainty in the Canadian economy and the US Tax reforms.
CPA Canada president and CEO Joy Thomas said external uncertainties dominate the concerns of the firms due to the amplifying protectionist trade sentiments and tax changes in the US.
“Canadian business leaders are looking for assurance from the federal government that the situation is being properly monitored to allow a course of action to be developed that will keep Canada competitive,” Thomas said.
In fact, a majority of Canadian business leaders noted that a thorough analysis of US tax reforms to assess their potential impact on Canada is needed.
In a recent interview with The Canadian Press, RBC president and CEO Dave McKay pointed out concerns about Canadian competitiveness, particularly involving the US tax reforms that could see a lot of investment opportunities, especially in the energy and clean-tech sectors, leaving Canada.
McKay warned that the investment exodus will be likely followed by a loss of talent.
“We would certainly encourage the federal government to look at these issues because, in real time, we’re seeing capital flow out of the country,” McKay told The Canadian Press.