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BC Launches InBC: $500M Investment Fund For Businesses – Strategy – Canada – Mondaq News Alerts

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BC Launches InBC: $500M Investment Fund For Businesses

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The BC Government has launched InBC, a
new $500M investment fund designed to support high growth potential
businesses and drive economic growth in every region of the
province. Although details of the new investment program are yet to
be released, we understand that InBC plans to invest in small and
medium-sized B.C. companies in an effort to support growth that
will allow them to reach their highest potential while remaining in
BC.

This new initiative aligns with the Government’s goal to
create well-paying jobs across the province through a “double
bottom line” approach, delivering commercial returns and
achieving priorities that reflect the values and needs of British
Columbians. It also follows the BC Government’s recent
introduction of Benefit Companies which seeks to balance
commercial opportunities with public benefits by conveying special
status to businesses that promote positive social goals.

InBC’s investment decisions will be made by an independent
Chief Investment Officer and a team of professionals. These
decisions will be guided by the BC Economic Plan: A Framework for Improving
British Columbians’ Standard of Living
, and the CleanBC strategy. InBC will be overseen by a
Board of Directors and will be required to submit annual reports
pursuant to the Budget Transparency and Accountability Act. The
audit of the financial statements will be overseen by the Auditor
General of B.C.

InBC is still in development and it is expected that its
investment strategy and criteria will be published during spring
2021. Further details will be provided as they become
available.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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Province to review investment strategy for Alberta's battered Heritage fund – CBC.ca

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The Alberta government is launching a review of the investment policy for Alberta’s Heritage Savings Trust Fund, which was battered by heavy losses earlier this year.

At the fund’s annual general meeting in Edmonton on Thursday, Alberta Treasury Board and Finance assistant deputy minister Lowell Epp announced his department will launch a “major review” of the $17-billion fund’s overall investment strategy and asset portfolio.

The review will be the first of its kind since 2011. It comes after a year that saw the Heritage fund — a rainy-day account financed by oil and gas royalties — pummelled by COVID-19 and risky investment decisions.

Seven years of gains were wiped out from the portfolio this spring after a volatility-based investment strategy left the fund’s investments vulnerable to the economic toll of the pandemic.

“There is a legislative requirement to invest the Heritage Savings Trust Fund in order to maximize long-term earnings with a prudent level of risk,” Jerrica Goodwin, a spokesperson for Treasury Board and Finance, said in an emailed statement Friday.

“This internal review will take place over the next year and will only evaluate how the fund is invested. This is not a review of the purpose of the fund, how it is used, nor will it consider changes to legislation.”

Kevin Uebelein, CEO of the Alberta Investment Management Corporation (AIMCo), which manages the Heritage fund, said he only learned of the review at Thursday’s meeting but wasn’t surprised. 

The review could result in changes to the fund’s overall asset mix, and how much risk its investments are allowed to take, Uebelein said.

“That kind of review, which is going to be thinking about the investment thesis, the investment policy, and then ultimately, the asset allocation that comes from that policy — those are all the responsibility of the Alberta government,” Uebelein said in an interview Friday.

“How does that impact the investment philosophy of the Heritage fund? Those are conversations that hopefully both the government and AIMCo will be able to have together.”

AIMCo operates at arm’s-length from the government. In addition to the Heritage fund, it manages 30 other government investment funds, along with three huge public sector pension plans for nearly 375,000 Albertans.

Uebelein said AIMCO’s investment strategy was ill-equipped to handle the unprecedented economic volatility caused by the pandemic.

AIMCo has succeeded in taking measured investment risks for years but this past year was the exception, he said.

The fund’s weakness was in an investment strategy that saw it make bets against volatility in the markets. This spring, amid unprecedented swings in the market, AIMCo lost billions on derivatives, investments that pay off only if stock prices remain stable.

‘An extremely painful lesson’ 

“It had been for many years quite a successful strategy. And then there was a week in March, I remember it, it’s sort of tattooed in my psyche,” Uebelein said. 

“The world experienced volatility like it really never seen before and a strategy that had been a perennial winner really was quite a large loser. 

“That strategy is shut down now … And that was an extremely painful lesson.” 

AIMCo came under fire this spring when it lost $2.1 billion on the volatility-based investment strategy.

The missteps cost the Heritage fund $411 million. In combination with global market losses in February and March, the fund was valued at $16.3 billion on March 31, its lowest point since 2011-12, according to the fund’s most recent annual report, released in July. 

The value was down about 10 per cent from the same time last year.

The value of the Heritage fund dropped $1.9 billion during 2019-20 — $1 billion was transferred to the province’s general revenue fund, and net losses, including unrealized losses, were $887 million for the fiscal year.

The investment breakdown included 44.8 per cent in equities, 19.5 per cent in fixed income and money market and 34.9 per cent in inflation-sensitive and alternative investments.

‘A marathon recovery’

Uebelein said AIMCo has already analyzed its losses extensively and is making changes to the investment portfolio. 

“Accountability includes being willing to talk about what happened, what we’re doing,” he said. 

“It includes making the necessary changes to the organization to make sure that those things never happen again and that we will learn and that we improve from that.” 

The Heritage fund has slowly started to recover. As of June 30, the fund was worth $17.2 billion. 

Investment income for the quarter was pegged at $4 million with a five per cent rate of return. 

Despite the gains, Uebelein said it will take years for the account to fully recover.

“You know, that may sound quite promising, but I just have to say, the recovery for the Heritage fund is really quite like the recovery in all of our lives and the economy writ large,” he said.

“We’re in a marathon recovery here. It’s not going to happen overnight. And we have to find a gear so that we can grind through this.”

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CIAC Welcomes Alberta Government's Plan to Level the Investment Competitiveness Playing Field, Attracting Global-Scale Chemical Manufacturing Investments – Canada NewsWire

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OTTAWA, ON, Oct. 30, 2020 /CNW/ – The Chemistry Industry Association of Canada (CIAC) congratulates the Government of Alberta on launching the Alberta Petrochemical Incentive Program (APIP). Building on the strong chemical manufacturing focus within the recently unveiled Natural Gas Vision and Strategy, APIP will help level the investment competitiveness playing field and attract a surge of global-scale, multi-billion dollar investments in the province’s low-carbon natural gas-based petrochemical sector. 

“The Alberta government has a bold vision for growth of Alberta’s chemical manufacturing sector,” said Bob Masterson, President and CEO, CIAC. “The Alberta Petrochemical Incentive Program levels the playing field with other jurisdictions competing for new investment and makes that vision of a top global chemicals producer possible. The opportunity for growth in this sector exists in the province and that is good news for jobs, new global scale investment, and Alberta’s economy.” 

The Alberta Government recognizes the importance and growth opportunity of a $12 billion sector that is Alberta’s largest manufacturing sector by exports and resource value-added. Alberta has an opportunity to diversify and build its economy on petrochemicals, a sector that has been resilient throughout the COVID-19 pandemic and is poised to see sustained demand continue for the foreseeable future. CIAC looks forward to working with the Alberta Government to attract new investment to the province. 

About CIAC 
The Chemistry Industry Association of Canada is the association for leaders in Canada’s chemistry and plastic sectors—adding C$54 billion and C$28 billion respectively to the Canadian economy. The Association represents close to 200 members and partners across the country. We provide coordination and leadership on key issues including innovation, investment, plastics, taxation, health and safety, environment, and regulatory initiatives. 

SOURCE Chemistry Industry Association of Canada

For further information: Devon Babin – Communications Manager, Chemistry Industry Association of Canada, [email protected], T 613-237-6215 ext. 225, C 613-620-3386

Related Links

www.canadianchemistry.ca/

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Province steps up with $2.7M investment for 20 beds at OSMH – OrilliaMatters

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Earlier this week, the provincial government announced it would be providing $116.5 million to create up to 766 more beds at 32 hospitals and alternate health facilities across the province. 

Simcoe North MPP Jill Dunlop explained what that investment means to Orillia.

She said the province will be providing up to $2,718,000 to Orillia’s Soldiers’ Memorial Hospital (OSMH) for up to 20 total patient beds.

The goal of the funding is to help alleviate hospital capacity pressures and reduce wait times and surgical backlogs.

“A bed is such an important part of the hospital process for both staff and patients,” Dunlop said in a statement.

“This investment will help improve the ability for Orillia Soldiers’ Memorial Hospital to provide care for patients, even more so during such a difficult time as COVID-19, especially with the upcoming winter and flu season.” 

This week’s funding is in addition to the $234.5 million investment for 139 critical-care beds and up to 1,349 hospital beds included in Ontario’s fall preparedness plan. 

The new funding “will further strengthen our ability to meet the health needs of our community,” said OSMH president and CEO Carmine Stumpo.

“This funding announcement supports the surge planning already underway at OSMH,” he explained. “This includes maintaining current emergency services, addressing backlogs in scheduled surgical activity and creating new capacity for COVID and influenza surges this winter.”    

Stumpo said the $2.7 million in one-time funding, to March 31, 2021, “will support operating expenses such as additional staff and medical supplies.” 

According to the media release from Dunlop, this brings the total investment to $351 million for more than 2,250 new beds at 57 hospitals and alternate health facilities across the province – beds that will add more capacity for hospitals, help with occupancy pressures and support the continuation of surgeries and procedures. 

“Our government is making the necessary investments to quickly and effectively increase hospital capacity and reduce wait times for patients and families in Simcoe,” said Health Minister Christine Elliott.

“This additional investment will ensure our health-care system is able to respond to future waves of COVID-19 and help patients waiting for surgeries and other procedures get the care they need, faster.” 

The government is providing $2.8 billion for the COVID-19 fall preparedness plan. It focuses on addressing surges in COVID-19 cases and reducing health service backlogs by:

  • Extending hours for additional priority surgeries and diagnostic imaging;  
  • Helping up to 850 alternate level of care patients access proper care in a home or community setting to help free up hospital capacity;  
  • Expanding digital health and virtual services, which provide alternatives to in-person care that limit the transmission of COVID-19, while maintaining access to care;
  • Improving access to mental health and addictions services and supports; and 
  • Increasing home and community care service by adding 484,000 nursing and therapy visits and 1.4 million personal support worker hours. 

Ontario will release its 2020 budget and the next phase of Ontario’s Action Plan on Nov. 5.

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