Businesses and economists say the proposed Alberta separatism referendum question is creating uncertainty that could hurt investment in the province.
Some Alberta companies say the political climate has already prompted concern from investors and, in at least one case, consideration of moving operations elsewhere.
Anthony Nelson, co-founder of 2S Water, said his investors began raising questions shortly after Premier Danielle Smith unveiled the referendum question last week.
“I had a number of investors who said, ‘OK, what’s your plan for getting out of Alberta?’” Nelson said.
The Oct. 19 referendum will include a question on whether Alberta should remain in Canada or if the province should hold a binding referendum on separation. Nine other questions announced in February deal with immigration and constitutional matters.
Nelson said the uncertainty has led him to consider relocating the company to British Columbia or Ontario in order to maintain investor confidence.
“The startup community attracts a lot of investors from Eastern Canada and the U.S., and those investors are concerned,” Nelson said.
“They’ve put money into this place, they’re looking for a good return on investment and now all of a sudden we’ve got a premier who’s trying to create chaos.
“It’s not good for us.”
Municipal leaders say they are also fielding questions and attempting to reassure organizations wary of the potential economic impact.
Edmonton Mayor Andrew Knack said businesses should play a role in the public discussion.
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“I do think it’s going to be important for businesses to speak up in this discussion, to remind people about the economic reality,” Knack said.
University of Alberta economist Chetan Dave said political uncertainty tied to separation discussions can dampen business confidence, particularly among larger firms.
“Businesses do not like — especially big businesses — this kind of political uncertainty,” Dave said.
He added even the prospect of a referendum can have consequences for investment decisions — regardless of the outcome.
“Even the threat of this kind of separation is going to cause businesses to pull back.”
More ambiguity means investment dollars stay on the sidelines, projects get more expensive and delays become more likely, said Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce.
“Uncertainty is the enemy of investment, and we’re now introduced to new elements of uncertainty,” she said last Friday.
The referendum news came a week after Smith and Prime Minister Mark Carney resolved one of the last remaining sticking points in the energy accord they signed late last year: an agreement on how to implement an increase in the industrial carbon price.
The memorandum of understanding lays out conditions that could see a new Alberta-West Coast pipeline built to enable more bitumen exports to Asia.
“We don’t need this,” Yedlin said of the separatism debate ratcheting up just as the regulatory logjam holding back resource development shows signs of loosening after a decade.
Yedlin said there’s a concern the rest of the country doesn’t appreciate the gravity of the situation, and that businesses based elsewhere in Canada aren’t immune to the risk of separation.
“It has to be something that we take seriously as a country and as a province because this is not worth breaking up the country for.”
Candace Laing, head of the Canadian Chamber of Commerce, said the country has already been contending with economic costs beyond its control while also recognizing the need to remove self-imposed barriers.
“Prolonged uncertainty around constitutional or political separation brings real risks for investor confidence, economic growth and Canada’s global competitiveness at exactly the wrong time,” she said.
“There are legitimate concerns being raised in Alberta around competitiveness, market access and economic opportunity. Canada’s democratic system is strong enough to address those concerns constructively while continuing to build a stronger, more competitive national economy together.”
The Alberta government has emphasized efforts to strengthen the province’s economy, despite the investment concerns.
Earlier this month, Jobs, Economy, Trade and Immigration Minister Joseph Schow said Alberta is expanding investment in sectors including aerospace, defence and advanced manufacturing, while also seeking new export markets.
In a statement, Schow’s press secretary said Alberta continues to offer a stable environment for investment.
“Despite global pressures, Alberta continues to lead the nation in economic growth, investment attraction and job creation — a testament to the confidence businesses have in our province,” the statement said.
— with files from Lauren Krugel, The Canadian Press
@Dani
If you think Alberta Independence is just about pipelines, think again. No representation in government, wokeness, high taxes, extreme national debt, climate catastrophising, stealing our wealth, actual truth and reconciliation, control over immigration – to name a few.
We want out of this nightmare. The cost to overcome any barriers will be minor compared rewards of setting our path right again.
maybe 2S Water should go to BC and go get the water rights to millions of gallons of water that can not be replaced,, BYEE!!
Separatists…
Several comments on the page talk about exporting products, especially through pipelines to eastern Canada and BC.
Has it not occurred to you that Alberta WILL NOT HAVE ACCESS to those pipelines if it leaves Canada?
The only route for exports will be south to the US, meaning the USA is the only Albertastan market. The USA will have all the leverage and will set the pricing (basic macroeconomics).
If you hadn’t been lied to for 50+ years (and been unable to figure put you were lied to, like I did decades ago), you’d be able to see the folly of separation. A decade later and the UK still is lost in the weeds (and they have access to international markets that Albertastan would not).
It’s all about Smith from high school days when her nickname was “two-faced.” Hubbies, then backstab Wild Rosers, then Kenney, then Canada, then the separatists…on and on…
Ottawa and the Laurentian elites create more instability for Alberta’s economic opportunities over 50 years than separation ever could.
Keep digging up the fear mongering. Oh what? Cora shares are what? What happens when the liberals stop paying you to pedal their drivel?
If we created our own currency, it would be among the strongest on the planet. We export everything the world needs. Grains, meats, O&G, tech etc.
Not good for Alberta to stay in this train wreck of a country!!
@Karl: No problem. Smith will dig up Red Deer for a deep sea port.
Smith is bad for business.
No one invests in uncertainty.
Karl, how stupid are you?
2s Water’s revenue is less than 1 million a year. Is this the only company you could find with an issue?
Isn’t Alberta landlocked????
Albertan, if you go, how long before you become the 51st state? Trump wants your oil!
Over half a trillion dollars ($500+ billion) in lost investment opportunities for Alberta/Canada’s energy sector over roughly the past decade, attributed to federal policies such as Bill C-69 (Impact Assessment Act), the carbon tax/pricing regime, emissions regulations, tanker bans, and project delays/approvals. Alberta independence would bring most of that investment back.
The Burnaby BC refinery is fed by the TMX pipeline, the Sarnia Ontario refineries are fed by Alberta pipelines. Natural gas flows to eastern Canada by Alberta pipelines. Asian and Canadian goods are transported through Alberta to and from BC coastal ports. So I believe the statement of some that Alberta will not have any leverage over Canada during negotiations are not really true.
C48 and C69 killed investment in the province. The separatist vote is a direct result of the federal meddling in allowing capital investment to happen.
There is at least $15B in repatriated monies coming back in separation that will buy a lot coverage while normalcy returns.
On the bright side, if Alberta does separate and has only on customer, it might be the cheapest place on earth to fuel up all the lifted Denalis prowling in Canadian urban centres. That’s supply and demand for you (although it hasn’t actual determined the honest price of anything since the early 2000’s).
@Aydon H Grant
Separation brings stability, huh? Haven’t thought it through at all, have you?
Alberta’s economy is driven by petroleum which, if Alberta is its own country, could ONLY be transported via pipeline into the US. As such, the US would be the only market Albertastan could sell to, meaning THEY set the price, not Alberta.
No Pacific pipelines.
No ocean ports (so everything will cost more).
No military.
No RCMP.
No currency.
No passports.
But, keep deluding yourself about stability.
Only drives out investors/business that depend on vast injections of federal sourced tax dollars (even though said tax dollars come mostly from Alberta in the first place).
So these tax dollar leaches are no loss.
STAYING is not good for us. Federally imposed costs, tariffs and taxes.
Separation allows us as a province to determine the rules…locally, not in Ottawa.
Separation grants far more stability than staying in the failure that is Canada.
The liberals destroyed it and have rendered it irreparable.
Carney says Brexit and the Alberta farmer wonders, is that what Brits call Bacon & Eggs
Dani already drove out billions in investment when she imposed the moratorium on renewable energy and then limited where it could be installed. Guess she’s trying to finish the job now.