Natural Resources, Reverse Mortgages, Sidewalk Labs
“We had an election in which no one talked about how to grow the economy”
…so Canadian business leaders are.
On Wednesday the Business Council of Canada released a report outlining specific recommendations for both the government and business community to grow Canada’s economy. The report includes recommendations on tax policy, regulations, infrastructure, and our resource and climate strategy.
The report outlines 6 recommendations for the government, but with concerning talks about #wexit, we thought we’d talk about recommendation number 6: Develop a national resource and climate strategy.
Resources have long been the foundation of the Canadian economy—in 2016 the sector was responsible for 16% of Canada’s GDP and employed 1.74 million Canadians (directly or indirectly). Further, resource companies are the largest employers of Indigenous peoples in Canada.
But, as the Business Council of Canada points out, polarization between provinces, and drawn out, stale debates about individual projects (case in point: TMX) have prevented us from creating a unified, bigger picture vision for the future of our country’s resources.
Our lack of a national strategy, combined with complex approval processes, long wait times, and the threat of court challenges are starting to have negative repercussions on the economy. Canada is getting a reputation for not being able to get things done, causing investors in key sectors to look elsewhere.
The Council’s solution? First up, the new government should call a meeting with the premiers to begin to develop a national resource strategy. Canada is currently facing an incredible opportunity to be a “a location of choice for leading-edge resource companies that demonstrate how to achieve superior economic and environmental performance”, but if provinces can’t work together toward national goals, it could be an opportunity missed.
Read the full report here.
Reverse Mortgages are on the Rise
We know what you’re thinking… I can barely afford rent, let alone a mortgage, so how do reverse mortgages affect me?
With the balances on reverse mortgages more than doubling in less than four years to $3.12 billion, concerns about how the loans will increase stress on already tight housing markets are becoming amplified.
So what’s a reverse mortgage? A reverse mortgage is essentially a loan to take out equity from your house without selling it. This borrowed amount can be taken as a lump sum or separated into payments and is exclusively available to people over the age of 55. Older Canadians commonly use this loan to supplement their retirement income.
The increase in reverse mortgages impacts young Canadians too – as rents continue to rise across the country, older Canadians are likely to stay in their homes longer, straining the increasingly competitive housing market.
Another concern is the high interest rates common to reverse mortgages. At almost double the rate of a traditional mortgage, the interest sharply eats into the value of a home once sold, further compounding the long-term financial impact on elderly Canadians. But with threats of an economic slowdown looming over Canada, reverse mortgages are likely to continue to rise.
Sidewalk Labs Update
Toronto’s controversial Sidewalk Labs’ proposal is moving forward, but not without some changes.
Sidewalk Labs, which is a subsidiary of Alphabet Inc (Google’s parent company), plans to build a ‘city of the future’ on a 12-acre plot of land at Queens Quay E and Parliament to be called Quayside, with data collecting sensors, self driving cars, on a 12-acre plot of land.
An agreement was signed this past Thursday by the board of Waterfront Toronto, which has required Sidewalk Labs to integrate some changes into the plan in an order to increase regulatory oversight oversight of the project. This agreement comes after months of protest by activists and locals concerned about the data collection component of the project.
For Sidewalk Labs, this agreement isn’t a total success. To make the most of their innovations, financially and technologically, they argue that the company needs to implement their project on a much larger scale. The original plan included expanding into a 190-acre area in the Port Lands.
The new agreement is a reset, in a sense, with the proposal approval deadline now pushed back to March 31, 2020.