The federal government’s latest initiative comes right out of the Liberal Party of Canada’s 2015 election platform: “We will establish the Canadian Infrastructure Bank to provide low-cost financing for new infrastructure projects.”
After a year in power, the party is finally making good on this particular election promise with the announcement in the fall economic statement by Finance Minister Bill Morneau that such a bank will indeed be created.
The idea certainly makes sense from the viewpoint that the federal government — with its supreme credit rating in the country — can borrow money more easily and at a lower rate than any other level of government, and pass along the savings to the provinces and municipalities that will spearhead the particular infrastructure’s development.
Where a lack of capital represents a barrier to projects, the Liberals say the arm’s length Canada Infrastructure Bank could provide loan guarantees and small capital contributions to provinces and municipalities to ensure the projects are built.
The Mining Association of Canada (MAC) was first out of the gate to praise the announcement as “bold, visionary and nation-building,” and setting Canada “on a path of long-term, sustainable growth” by attracting private-sector investment, getting Canadian goods to markets, addressing challenges in remote and northern communities — including aboriginal employment — and supporting the transition to a lower carbon economy.
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