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Canada has lost $196 billion in resource projects


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3 hours ago, Argus said:

Why the hell would China want to buy something we make here for three times the price of the same item made there? Why would anyone else?

Because if they do not have the raw materials they will not be able to make nothing.

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7 hours ago, cougar said:

Because if they do not have the raw materials they will not be able to make nothing.

I have been doing business with and within China for more than 25 years.   As you should be able to see from the Huawei affair, if China doesn't want to buy something from Canada...even if it seems to "need" it, they won't.  We are simply not in any position to compete head on with China or Chinese business.  Their ability to finance actual business leaves us (and the rest of the world) in the dust.  The cost of labour, but more that, the relative productivity is something we can't even imagine, never mind compete with.

Let me give you and example of how China views a market.   The future of light aviation engines lies strongly with diesels.  So, do Chinese companies buy existing engines or do they try to sell Chinese-made aircraft diesels?   Neither...yet.   The 100HP class of engine at the moment is dominated by Rotax, but a beautiful little opposed piston diesel (Gemini) will some day eliminate Rotax from the marketplace.  the Gemini project was bought by Superior in the US (where aircraft engine production has credibility in international markets.  Superior is owned 100% by Chinese.  Thielert broke open the market with their 135 HP engine about 20 years ago.  Thielert was bought by one of the big two players in genav engines - Continental.   Continental is owned lock stock and barrel by Chinese.  Only SMA (Renault) who have only a tiny sliver of that market (due to cost) and as it is, their only viable product has been licensed to Continental for further development.  And on it goes.  By far the volume leader is Austro with their 170 and 180 HP engines.  Austro belongs to Diamond (as in the people who make airplanes in London ON), and Diamond now belongs 100% to China (thus a lot of work shifting OUT of London ON).   China doesn't come into a market to compete with others, they come in to dominate it.  Their business practices are not competitive, they are predatory.   To put that into a Canadian perspective:  have a look at just what percentage of Athabasca Oil Sands leases are in Chinese hands...the number will shock you.  If you think they are going to take Canadian heavy oil out of the ground and add all of the value at our ridiculously expensive and inefficient level of costs, you (and the rest of Canada) have a very rude shock coming.

We need to concentrate on markets that are culturally and economically compatible with our inept way of doing business.   To get what I mean, look at how the Canadian automobile industry has been decimated (it was by far our largest value added export market, and it is nearly gone now - to be replace with, let me count it up...NOTHING).

Take a look at the ONLY one of the $196Bn of the subject of this thread that HAS gone forward.  The $40 Bn LNG Canada is a consortium of companies led by Shell Canada and includes Petronas, PetroChina, KOGAS and Mitsubishi Corporation.  Pretty much 100% foreign owned and controlled.  There will be considerable value added to otherwise nearly worthless Alberta gas, but Canadians will just be doing the work, not owning the process.

Edited by cannuck
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12 hours ago, cannuck said:

Add value to resources.   It is the ONLY way wealth is created.  We have access to the wealthiest (about to fall to second wealthiest) market on Earth, just across a relatively open border, and we have huge potential markets in Yurp and MENA.

And what do you imagine we can make that we aren't already that they can't make more cheaply? They have lower taxes, lower energy costs, no carbon taxes, fewer regulations, lower wages...

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12 hours ago, cougar said:

Because if they do not have the raw materials they will not be able to make nothing.

Nice in theory, but we are not by any stretch of the imagination the only suppliers of raw materials.

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9 hours ago, cannuck said:

I have been doing business with and within China for more than 25 years.   As you should be able to see from the Huawei affair, if China doesn't want to buy something from Canada...even if it seems to "need" it, they won't.  We are simply not in any position to compete head on with China or Chinese business.  Their ability to finance actual business leaves us (and the rest of the world) in the dust.  The cost of labour, but more that, the relative productivity is something we can't even imagine, never mind compete with.

Let me give you and example of how China views a market.   The future of light aviation engines lies strongly with diesels.  So, do Chinese companies buy existing engines or do they try to sell Chinese-made aircraft diesels?   Neither...yet.   The 100HP class of engine at the moment is dominated by Rotax, but a beautiful little opposed piston diesel (Gemini) will some day eliminate Rotax from the marketplace.  the Gemini project was bought by Superior in the US (where aircraft engine production has credibility in international markets.  Superior is owned 100% by Chinese.  Thielert broke open the market with their 135 HP engine about 20 years ago.  Thielert was bought by one of the big two players in genav engines - Continental.   Continental is owned lock stock and barrel by Chinese.  Only SMA (Renault) who have only a tiny sliver of that market (due to cost) and as it is, their only viable product has been licensed to Continental for further development.  And on it goes.  By far the volume leader is Austro with their 170 and 180 HP engines.  Austro belongs to Diamond (as in the people who make airplanes in London ON), and Diamond now belongs 100% to China (thus a lot of work shifting OUT of London ON).   China doesn't come into a market to compete with others, they come in to dominate it.  Their business practices are not competitive, they are predatory.   To put that into a Canadian perspective:  have a look at just what percentage of Athabasca Oil Sands leases are in Chinese hands...the number will shock you.  If you think they are going to take Canadian heavy oil out of the ground and add all of the value at our ridiculously expensive and inefficient level of costs, you (and the rest of Canada) have a very rude shock coming.

We need to concentrate on markets that are culturally and economically compatible with our inept way of doing business.   To get what I mean, look at how the Canadian automobile industry has been decimated (it was by far our largest value added export market, and it is nearly gone now - to be replace with, let me count it up...NOTHING).

Take a look at the ONLY one of the $196Bn of the subject of this thread that HAS gone forward.  The $40 Bn LNG Canada is a consortium of companies led by Shell Canada and includes Petronas, PetroChina, KOGAS and Mitsubishi Corporation.  Pretty much 100% foreign owned and controlled.  There will be considerable value added to otherwise nearly worthless Alberta gas, but Canadians will just be doing the work, not owning the process.

If it were not for the federal socialist government and it's too many taxes and a too big a government bureaucracy and the many rules and regulations and red tape in Canada we could create more jobs here in Canada, and create just as much taxes, and probably be able to buy most things at a decent price. Canada has the potential to become a very wealthy country but it is our dear leaders who appear to not want to make Canada great. They appear to want to make Canada broke and poor. 

Canada has lost billions because we have leaders who just do not have the bal-ls to say let's open Canada up and make Canadians and Canada great again. The GST would be gone. The liberals, socialist, communist and the environmentalists and marketing boards have turned Canada into a welfare mess rather than a wealthy mess. There is no reason as to why our Canadian dollar is so low compared to the American or Euro dollar. As far as I am concerned it is so simple. But Canadians have been led to believe that simple is not the answer. Making life difficult for all is the answer. I could save hundreds of billions of tax dollars tomorrow. Lucky for the globalist elite and their puppet on a string Canadian politicians that I am not the leader of this country.

Some people are just so lucky. LOL. 

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On 6/7/2019 at 9:18 PM, cougar said:

I am curious what you personally get out of these projects?  Are you employed in the Oil and Gas?  A miner or a logger?

You can throw all the insults you like; I can answer with the same, except I will not bother.

Yes, I am a logger.

What I  'get out of these projects'  is the satisfaction and pleasure of providing for my family.

No hand-outs here.

Guessing you're some idealistic un-employed transplant from central/eastern Canada.

Betting you have the answer to everything. Extremely intelligent . . . but, your shoes are on the wrong feet.

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7 hours ago, Argus said:

And what do you imagine we can make that we aren't already that they can't make more cheaply? They have lower taxes, lower energy costs, no carbon taxes, fewer regulations, lower wages...

That is how China does business, and it is a zero percent possibility for Canada to try to compete with US on cost, never mind China.  To sell to the USA and especially Europe, you/we simply need to be able to compete on quality or uniqueness (niche marketing).   Canadian culture (things such as actually telling the truth and following the rules) means we can actually do some things far better here than in the USA.   A lot of high volume production these days is highly automated, and it is the skill of keeping the machine running (and supplied) that wins the day.  One of our highest potentials but least realized is our ability to add value to foods by producing finished product to suit specific export markets.  I happen to know of several particular things we can even sell in China - as we are very trusted there (by the real business, not government).

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2 hours ago, cannuck said:

That is how China does business, and it is a zero percent possibility for Canada to try to compete with US on cost, never mind China.  To sell to the USA and especially Europe, you/we simply need to be able to compete on quality or uniqueness (niche marketing).   Canadian culture (things such as actually telling the truth and following the rules) means we can actually do some things far better here than in the USA.   A lot of high volume production these days is highly automated, and it is the skill of keeping the machine running (and supplied) that wins the day.  One of our highest potentials but least realized is our ability to add value to foods by producing finished product to suit specific export markets.  I happen to know of several particular things we can even sell in China - as we are very trusted there (by the real business, not government).

That's all very well and good, but niche marketing is not going to replace tens of billions in resource exports. Our productivity is low and not increasing much at all. Most of our larger corporations are foreign owned, and we have a government determined to add as much cost and delay to business as possible through multiplying red tape.

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2 hours ago, cannuck said:

That is how China does business, and it is a zero percent possibility for Canada to try to compete with US on cost, never mind China.  To sell to the USA and especially Europe, you/we simply need to be able to compete on quality or uniqueness (niche marketing).   Canadian culture (things such as actually telling the truth and following the rules) means we can actually do some things far better here than in the USA.  

 

....and some things are much worse.   Canada has inter-provincial trade barriers that are another drag on the economy.  "Canadian culture" has also meant cutting off your economic nose to spite your face because of internally imposed limits and corresponding lack of domestic capital, yielding ownership and control to foreign players.

What unique, value added and vertically integrated products does Canada offer...today ?

 

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7 minutes ago, Argus said:

That's all very well and good, but niche marketing is not going to replace tens of billions in resource exports. Our productivity is low and not increasing much at all. Most of our larger corporations are foreign owned, and we have a government determined to add as much cost and delay to business as possible through multiplying red tape.

Never for one moment suggested we stop exporting from our finite store of resource wealth, just that we start actually making things (like the US did before they became too important to bother).  A few hundred successful niches are a hell of a lot better than doing diddly squat as we are now.

I do agree, though, that the level of government BS required to do business in Canada is not exactly fun and games.  Spent the last part of the week trying to explain to my Chinese friends why we can't just do this or do that, where they can so easily with a nudge-nudge, wink-wink (for environmental issues) or a quick bribe or two to officials that only the well healed SNCs of this country can manage.

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4 hours ago, taxme said:

If it were not for the federal socialist government and it's too many taxes and a too big a government bureaucracy and the many rules and regulations and red tape in Canada we could create more jobs here in Canada, and create just as much taxes, and probably be able to buy most things at a decent price. Canada has the potential to become a very wealthy country but it is our dear leaders who appear to not want to make Canada great. They appear to want to make Canada broke and poor.

Looks like calling something "socialist" is an offense.  The principles of socialism had their merits.  Our government has little to do with socialism.

I am not interested to know how China gets to dominate a market.  They get into a place because someone is ready to sell it to them.  I have no doubt much of our forests are sold to them as well as much of the oil and gas fields.  They have bought most of Vancouver too on a lower , personal level. But then you have nationalists like Argus, who believe that helping their projects actually helps Canada. (what part of Canada, I am not sure)

Canada for many years has been supposedly hiring the brightest, smartest, healthiest professionals from around the world.  Not only that but they have been brought over to fill specific industry demands.   The final result is what you see.  We are puppets of China and the US since we never tried to have our own products and stand behind our own technologies.  All hi-tech jobs went to Asia, and then the next level of jobs, and then the next.

What we have now is a society based entirely on the resource industries and supporting industries and businesses.  We have a lot of sales associates, equipment operators, drivers, loggers and miners and of course real estate agents (surviving on overinflated real -estate prices).

And that is because even Argus believes we cannot be as fast as them, as smart as them and working for less than them.   So lets open our borders, give them all they want and hope for merciful treatment.

 

 

 

 

 

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4 minutes ago, cannuck said:

Never for one moment suggested we stop exporting from our finite store of resource wealth, just that we start actually making things (like the US did before they became too important to bother).

 

I don't know why this false narrative gets repeated so often in Canada....maybe it makes some feel better about their own fate north of the border, as if they have no control over what happens because the foreign owners (e.g. Americans) are running the show.

The US still makes many, many things....increasingly so except during recessions.   

Falsely reporting US manufacturing decline has become an excuse in Canada.

 

image.png.fda857e2bbf24824791026fc1f47a4dc.png

 

https://www.forbes.com/sites/jimvinoski/2018/08/21/us-manufacturing-the-reports-of-my-death-are-greatly-exaggerated/#56d8bf4d3884

 

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B-C:  look at your own graph.  The blue line from 1988 to 2000 represents the established value and growth of the pre Y2K US economy.  Extrapolate it to the right and there is one hell of a big gap.  You are only at 65% or so of your appropriate level of manufacturing.

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5 minutes ago, cannuck said:

B-C:  look at your own graph.  The blue line from 1988 to 2000 represents the established value and growth of the pre Y2K US economy.  Extrapolate it to the right and there is one hell of a big gap.  You are only at 65% or so of your appropriate level of manufacturing.

 

Growth as a percentage of GDP is a secondary issue, but it is still net positive, not in decline save for the recession years.   The manufacturing baseline for the graph is 2012.

It is a false narrative and false excuse to claim U.S. manufacturing decline for the state of things in Canada, but often invoked anyway because Canada has convinced itself that as go the Americans, so does Canada.    Canada lacks the means and will to do otherwise.

Edited by bush_cheney2004
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As I have told you many times before, most of my business is NOT in Canada, but the US.  That is switching to have a far more Chinese component.   Doesn't mean I can't see what is (not) going on in Canada and the USA.

Let's take one particular product: large power transformers.  There is really only one major US manufacturer left, and their contribution is not very large and certainly not recognized as a quality product.  The vast majority of utility transformers in the USA are now imported.  You can't even keep your own lights on any more.  Far more disturbing is that the really big stuff (500 MVA and up) is now coming from China.  They not only own the retail shelves of every WalMart, Harbour Freight, furniture store, etc. but can do critical infrastructure hardware that the US can not.  Oh...I forgot: Canada still makes a few in the upper mid size - mostly exported to the USA.  Still, the Canadian market has also lost a similar portion of that manufacturing capacity.

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Just now, cannuck said:

As I have told you many times before, most of my business is NOT in Canada, but the US.  That is switching to have a far more Chinese component.   Doesn't mean I can't see what is (not) going on in Canada and the USA.

 

That's fine, and this is not about your business specifically, but Canada's manufacturing base has really been in decline, and is now surpassed by Mexico as well

images?q=tbn:ANd9GcSslWdq28JJMkG_NnxmAn2

 

Quote

Let's take one particular product: large power transformers.  There is really only one major US manufacturer left, and their contribution is not very large and certainly not recognized as a quality product.  The vast majority of utility transformers in the USA are now imported.  You can't even keep your own lights on any more.  Far more disturbing is that the really big stuff (500 MVA and up) is now coming from China.  They not only own the retail shelves of every WalMart, Harbour Freight, furniture store, etc. but can do critical infrastructure hardware that the US can not.  Oh...I forgot: Canada still makes a few in the upper mid size - mostly exported to the USA.  Still, the Canadian market has also lost a similar portion of that manufacturing capacity.

 

Globalization of large transformers and components has been happening for decades (e.g. Siemens and ABB), and not just to China.   China also has large market share in photovoltaic renewables.   Most Americans do not toss in their sleep worrying about the state of manufacturing in Canada because of all those special, niche products.

The larger point is that what happens in the U.S. should not be the oft repeated excuse for fleeing investment and dismal manufacturing growth in Canada.

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1 hour ago, bush_cheney2004 said:

 

The larger point is that what happens in the U.S. should not be the oft repeated excuse for fleeing investment and dismal manufacturing growth in Canada.

Actually,  it IS very much the excuse for why investment is fleeing, as is manufacturing.   about 70% of all Canada/US trade was in cars and car parts.  We built our economy, such as it was, around that secure, solid market where we shared a language and culture with our very large neighbour.  Since the US has pretty well screwed up in the car biz, and so much of what we used to do is now coming from lower cost sources in Mexico and China - and more to the point we do this mostly with US investment and control (obvious exception being Magna International) because we simply haven't needed to develop our own infrastructure to finance and operate much in the line of business.  Oh, we can do marijuana allright, but not so good at the real core stuff.

Edited by cannuck
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48 minutes ago, cannuck said:

Actually,  it IS very much the excuse for why investment is fleeing, as is manufacturing.   about 70% of all Canada/US trade was in cars and car parts.  We built our economy, such as it was, around that secure, solid market where we shared a language and culture with our very large neighbour. 

 

Right...Canada built its economy around such a lopsided dependency...so Canada bears the consequences of its decision(s) and lack of diversification.

The U.S. is not the reason, but it is the excuse.

The world can wait for Canada to build those special niche products that it hasn't had so far.

 

 

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15 hours ago, bush_cheney2004 said:

 

I don't know why this false narrative gets repeated so often in Canada....maybe it makes some feel better about their own fate north of the border, as if they have no control over what happens because the foreign owners (e.g. Americans) are running the show.

The US still makes many, many things....increasingly so except during recessions.   

Falsely reporting US manufacturing decline has become an excuse in Canada.

Gee, you think maybe they got that from your lying scumbag of a president? Who says it constantly?

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6 hours ago, Argus said:

Gee, you think maybe they got that from your lying scumbag of a president? Who says it constantly?

 

Nope....Canada's whining about the decline of manufacturing in "North America" (which curiously excludes Mexico depending on the context) was happening long before Trump became president.     The real decline was U.S. manufacturing jobs, not manufacturing output, wherein Canada/Ontario lags on both because of lower productivity and capital investment.

America cannot save Canada from itself, and Trump is not responsible for Canada's economy.    But don't worry, I'm sure Justin Trudeau will continue his virtue signaling policies that help Canadian projects so much, like this:

 

Quote

The premiers say in the letter that C-69 would make it "virtually impossible" to develop infrastructure projects for resource extraction and deprive the country of "much needed investment."

Premiers 'threatening national unity' with their demands on federal environmental bills: Trudeau

 

Edited by bush_cheney2004
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