Collaborative approach: foreign direct investment in GTA

NRU
Nov. 25, 2015
By Leah Wong

With the second largest municipality in the Greater Toronto Area signed on, the region’s new foreign direct investment agency is one step closer to coming into existence.

Last week Mississauga general committee voted to support, in principle, the establishment of a new FDI attraction agency in the GTA and to quadruple its portion of regional funding in 2016. The new organization builds on the work of the Greater Toronto Marketing Alliance by providing the funding necessary to further pursue FDI activities.

“We can’t afford not to do this,” Mayor Bonnie Crombie told committee. “I think there is a value in marketing ourselves as a region.”

Crombie sits on the interim board of directors for the new FDI agency, which is currently being referred to as NewCo. In addition to Crombie, the board comprises Pickering mayor Dave Ryan, Toronto mayor John Tory, York Region chair Wayne Emmerson, NewCo interim CEO Toby Lennox, Toronto Financial Services Alliance president and CEO Janet Ecker and IBM Canada vice-president Pat Horgan.

Mississauga presently contributes $56,000 to the GTMA and plans to increase its funding to $228,000 once the new agency is formed.

With the new agency comes a new funding model, with the provincial government committed to provide $2.5-million annually.

The federal government has been asked to match the province’s contribution. While no firm commitment has been made, reports indicate a willingness to review the agency’s request. The private sector and academic institutions will contribute an additional $500,000.

The new agency will comprise the City of Toronto and the municipalities in Durham, Halton, Peel and York regions, with each contributing to its budget based on population. Toronto has committed to folding the activities of its FDI agency, Invest Toronto, into the new organization. Crombie said Toronto’s commitment to this new organization is significant and distinguishes it from the GTMA.

While the GTMA is a partnership of local and regional municipalities Mississauga economic development director Susan Amring told committee that it is underperforming due to a lack of funding.

“It’s clear from GTMA’s [2012 Roadmap to Revitalization] study that the status quo will not allow the GTA region to capitalize on its strengths and attract more foreign direct investment,” said Amring.

GE Canada communications vice-president and Mississauga Economic Development Advisory Board chair Kim Warburton told committee that her company is concerned only 1 per cent of foreign direct investment comes into Ontario. This has been on the decline since the 1970s.

With more jurisdictions competing to attract FDI and new jobs she said CEOs of large corporations appreciate a more collaborative approach to attracting investment.

“To get the region to register [with foreign investors] requires a much bigger, bolder strategy and approach,” said Warburton. “The city as part of [the new agency] will benefit, as well as the region and province.”