Stephen Harper warns investors are losing faith in Canada: Sources
In mid-January, while addressing an audience of foreign investors and oil and gas executives in London, former Prime Minister Stephen Harper cast doubt on Canada’s business environment.
“The theme of his speech was that people have lost confidence in Canada,” according to the CEO of one Calgary-based oil and gas company that presented at the conference. The chief executive declined to be identified because the event was private.
For many in the audience, Harper was addressing some of their key frustrations, built off frequently mentioned industry challenges such as pipeline delays and regulatory headaches.
“Everybody there was aware of the issues facing the energy industry,” according to another person who attended, who did not want to be named.
“The reality is that institutional investors have lost confidence in Canada,” according to the CEO of the oil and gas company. “Harper highlighted a list of things making us uncompetitive and things we have to do to attract investment.”
Anna Tomala, a spokesperson for Harper, declined to comment on the remarks made at the TD conference. TD Securities spokesperson Lynsey Wynberg also declined to comment because the event was closed to the media.
The former prime minister has kept a relatively low profile since the 2015 federal election. Most of his remarks have been tied to the themes in his new book, “Right Here, Right Now,” which addresses some of what was discussed during his January speech.
“Most of his comments were on the state of democracy, from a conservative perspective. But he did slide toward criticism of the current Canadian government,” one attendee of the Harper event told BNN Bloomberg on background, citing the private nature of the conference.
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While Harper is on the advisory board of Azimuth Capital Management, an energy-focused private equity firm, he is not widely viewed behind the scenes as an advocate for the energy industry.
"He's not really seen as an oil patch insider and never was,” said investment banker Rick Peterson, who helps lead energy industry advocacy group Suits and Boots and ran for the leadership of the Conservative Party of Canada in 2017, in an email to BNN Bloomberg. He was not in attendance at the TD conference.
"Mr. Harper is obviously enormously respected in Calgary,” Peterson added. “I think his macro views on the world, and his insight into the dynamics of what's happening on a big picture scale are of interest to anyone in the energy sector.”
Some energy investors hoped to learn more about Harper’s views at a private event in Toronto on Monday, ahead of his trip to Chile for meetings with the International Democratic Union (IDU), which he chairs.
According to a source who has spent time with Harper in recent months, the negative sentiment around investing in Canada has been echoed to him as he travels around the world for speeches and for work tied to his consulting firm, Harper & Associates.
“He’s been hearing it from other CEOs -- this idea that the cost of doing business in Canada is too high,” according to the source who was not at the TD conference and did not want to be named. “So it wouldn’t be unusual for Harper to express that view privately.”
In addition, Harper has had a front row seat when it comes to Alberta’s economic challenges.
The province continues to have one of the highest unemployment rates in the country, at 6.9 per cent, while the office vacancy rate in downtown Calgary where his consulting firm is based remains elevated, at 26.5 per cent, according to CBRE.
“He’s frustrated, particularly since he still lives in Calgary,” one longtime friend and former colleague of Harper’s told BNN Bloomberg.
Two sources familiar with Harper’s remarks told BNN Bloomberg the former prime minister described Canada as being uninvestible during the Jan. 14 event. The sources did not attend the event.
The word “uninvestible” has increasingly been used to describe Canada as frustration builds among industry players.
“Canada is best described as moving sideways to backwards with its confusing efforts at regulatory reform and misguided attacks on the key economic engines of our country - entrepreneurs and the energy sector. Investors are either leaving or standing on the sidelines wondering,” Brett Wilson, Canoe Financial’s chairman, told BNN Bloomberg in an email.
In a statement late Tuesday morning, Harper disputed the way his comments were portrayed.
“I have never described Canadian energy as ‘uninvestible.’ On the contrary, I always emphasize that I personally remain an investor in Canadian energy and that there are many good, long-run investment opportunities, despite current government policy and the negative investor sentiment it has created,” he wrote via a spokesperson in an email to BNN Bloomberg.
Former Encana CEO Gwyn Morgan, who did not attend the TD event in January, was not surprised by Harper’s comments.
“Stephen is not prime minister anymore. There’s nothing to stop him from lamenting about [Prime Minister Justin] Trudeau’s politics,” Morgan told BNN Bloomberg in a phone interview.
Still, some in the audience were surprised to hear a former head of government describe Canada’s business environment in such a fashion.
“A past prime minister or premier should be cautious about making any comment that would be interpreted as being critical of his own country when speaking to a foreign audience,” said one former senior Canadian politician, who declined to be named when reached by BNN Bloomberg.