CME Calls on Government to close the gap on US’ Inflation Reduction Act incentives at Standing Committee on International Trade
November 1, 2022. Ottawa – Canadian Manufacturers & Exporters (CME) appeared before the Standing Committee on International Trade as part of the committee’s investigation into the impacts of the US’ Inflation Reduction Act (IRA) on Canadian businesses and trade. CME urged the government to quickly close the gaps with the IRA’s new incentives or risk losing crucial manufacturing investment to the United States.
In its opening remarks, CME stated that: “We are joined today by colleagues from many of Canada’s key manufacturing industrial sectors and from organized labour. We are all united in our concern of the impacts the IRA. Concerned that this bill has radically increased the amount of money the US government is pouring into their manufacturing companies. Concerned that this could trigger a flight of capital investment out of Canada and into the US. And concerned that this could result in less manufacturing jobs for Canadians”.
CME went on to urge the committee and the government to quickly narrow the incentive gap between the US and Canada, to redouble diplomatic efforts to combat Buy-America polices, to extend and enhance Canada’s Accelerated Investment Incentive, and to grow trade and exports by growing manufacturing capacity.
“Manufacturers are very concerned with the negative impacts of the US’ Inflation Reduction Act’s incentives. If Canada does not match them, it will weaken our sector’s ability to compete with the US on an even footing. We must quickly introduce a suite of incentives that will narrow this gap. This will be seen as a sound investment in our industrial competitiveness that will set us up for economic success for years to come”.
- The manufacturing sector accounts for nearly 10% of Canada’s real gross domestic product.
- Manufacturers employ 1.7 million people in Canada.
- Total manufacturing sales hit a record high of $718.4 billion in 2021.