Ottawa Citizen editorial endorses MLI Commentary on foreign direct investment
June 29, 2012 – MLI’s Commentary, Potash and BlackBerries: Should Canada treat all foreign direct investment the same? by Laura Dawson, is the subject of a latest editorial in the Ottawa Citizen! The full editorial is copied below. It was also reprinted in the Vancouver Sun.
Ottawa Citizen, June 29, 2012
There are reasons to be concerned about Research in Motion. It’s dangerous, though, to let too much of our Canadian identity get tangled up with the fortunes of a single company.
RIM’s products, services and network have changed the global tech marketplace, and it’s still far from dead. But it’s losing money, cutting jobs and delaying its next BlackBerry product. Its stock took a big hit on Friday morning. Some analysts are saying a breakup or sale is now all but inevitable; it’s only a question of when.
That possibility is bound to make a lot of Canadians nervous, since it might mean that some or all of RIM’s assets would end up in foreign hands.
“There will certainly be symbolic damage if Canada’s flagship IP company left the country or faded into obscurity like the Atari or the Betamax,” writes Laura Dawson in a recent report for the Macdonald-Laurier Institute, “but national pride weathered the disintegration of Nortel and the relocation of Alcatel to France. It would certainly survive the end of RIM.”
A takeover would trigger a federal review, but there’s no reason to assume foreign acquisition would necessarily be a bad thing. Research and development, and jobs, could stay in Canada under new ownership. There is a national security aspect to consider, since BlackBerries are used so widely in government, but again, that isn’t enough to trigger a knee-jerk nationalist rejection of a foreign takeover, or a government bailout. The Canadian government should watch what happens with RIM very closely, but it shouldn’t base its decisions on xenophobia.
Canadian companies invest in the rest of the world more than foreign companies invest in Canada. Canada’s chronic economic problem isn’t foreign ownership within our borders; it’s a lack of productivity and innovation. We can’t create a more innovative culture by shielding Canadian companies from global competition, or by propping them up when they run into trouble. The big question for Canadians is not whether we can hold on to RIM, but whether we can foster more innovative companies and give them the tools to succeed.
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