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Montréal International says foreign direct investment fell 15% in 2020 – Montreal Gazette

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Montréal International says foreign direct investment fell 15% in 2020 – Montreal Gazette


Some 90 investment projects resulted in the creation or preservation of 8,192 jobs, the economic development agency says.

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Montreal attracted about $2.2 billion worth of foreign direct investments in 2020 as the COVID-19 pandemic raged, a 15-per-cent drop from the previous year.

Some 90 investment projects resulted in the creation or preservation of 8,192 jobs, with an average salary of $83,976, the Montréal International economic development agency said Monday.

Key announcements last year included expansion projects by Google, Kraft and software maker Behavox, for a total of $2.6 billion of investments.

Montréal International’s 2020 performance compares favourably with a 42-per-cent-plunge in foreign direct investment globally last year, as calculated by the United Nations Conference on Trade and Development. Despite the slowdown, MI still managed to post its third-best annual results since the agency was created in 1996.

“Given the year we’ve just been through, these results are very encouraging,” Quebec Economy Minister Pierre Fitzgibbon said Monday during an online press conference.

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“They show that even with the global pandemic, we still managed to generate economic spinoffs for Greater Montreal and all of Quebec. We preserved our competitiveness.”

Along with rising exports and the capacity to attract skilled workers, foreign investments will play a key role in fuelling economic growth in Quebec, Fitzgibbon said. Foreign investments across the province, however, fell to about $4 billion last year from about $5.6 billion in 2019, he said.

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Companies from 19 countries invested in Montreal last year, with nearly half of investments coming from Europe and 44 per cent from the Americas. Top industries included computer services, with about one-fifth of total projects; software; artificial intelligence; transportation logistics and life sciences.

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Faced with closed borders and travel restrictions, MI pivoted to virtual trade and recruitment campaigns as a means of luring both companies and employees to the city. Seven of the 12 recruitment missions took place entirely online, which led to the hiring of 772 skilled foreign workers — including 237 nurses. French workers accounted for 75 per cent of new hires, MI said.

A new website, talentmontreal.com, was also created to help local companies recruit abroad.

Meetings with more than 200 entrepreneurs resulted in 10 new startups putting down roots in the city. MI’s team also met over 7,800 international students, most of them online, to convince them of studying or living here.

MI’s role “is more important than ever because there will be a rush on talent” when economic output accelerates after the pandemic, said federal Economic Development Minister Mélanie Joly, who also spoke at the press conference.

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More than 150 “very active” investment files are now being worked on, which bodes well for 2021, chief executive officer Stéphane Paquet said Monday. Cybersecurity, e-commerce, video games and life sciences are among the most promising industries this year, Paquet said in a telephone interview.

Aerospace companies — long among the city’s biggest employers — are unlikely to figure on the list of major investors this year. Foreign investments in aerospace slumped to about $126 million last year from $285 million in 2019, and Paquet said he’s not expecting a quick fix.

“In the short term it, will be very difficult to attract investments in civil aviation,” Paquet told the Montreal Gazette. Even so, “there are things to do in aerospace,” he said, citing possibilities in drones and satellites.

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With projected 2021 growth of 5.4 per cent, Montreal is on track to post the best economic performance of all major Canadian cities, according to a Conference Board of Canada forecast. This compares with expected growth of 5.1 per cent in both Calgary and Toronto, and 4.9 per cent in Vancouver.

“There will be a recovery, and we will be there for it,” Paquet said. “Our pipeline is very solid. I’m convinced 2021 will be a very good year.”

ftomesco@postmedia.com

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More China coal investments overseas cancelled than commissioned since 2017

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EU, U.S. agree to talk on carbon border tariff

More China-invested overseas coal-fired power capacity was cancelled than commissioned since 2017, research showed on Wednesday, highlighting the obstacles facing the industry as countries work to reduce carbon emissions.

The Centre for Research on Energy and Clean Air (CREA) said that the amount of capacity shelved or cancelled since 2017 was 4.5 times higher than the amount that went into construction over the period.

Coal-fired power is one of the biggest sources of climate-warming carbon dioxide emissions, and the wave of cancellations also reflects rising concerns about the sector’s long-term economic competitiveness.

Since 2016, the top 10 banks involved in global coal financing were all Chinese, and around 12% of all coal plants operating outside of China can be linked to Chinese banks, utilities, equipment manufacturers and construction firms, CREA said.

But although 80 gigawatts of China-backed capacity is still in the pipeline, many of the projects could face further setbacks as public opposition rises and financing becomes more difficult, it added.

China is currently drawing up policies that it says will allow it to bring greenhouse gas emissions to a peak by 2030 and to become carbon-neutral by 2060.

But it was responsible for more than half the world’s coal-fired power generation last year, and it will not start to cut coal consumption until 2026, President Xi Jinping said in April.

Environmental groups have called on China to stop financing coal-fired power entirely and to use the funds to invest in cleaner forms of energy, and there are already signs that it is cutting back on coal investments both at home and abroad.

Following rule changes implemented by the central bank earlier this year, “clean coal” is no longer eligible for green financing.

Industrial and Commercial Bank of China, the world’s biggest bank by assets and a major source of global coal financing, is also drawing up a “road map” to pull out of the sector, its chief economist Zhou Yueqiu said at the end of May.

 

(Reporting by David Stanway; Editing by Kenneth Maxwell)

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Bank of Montreal CEO sees growth in U.S. share of earnings

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Bank of Montreal earnings beat estimates, adds mortgage safeguards

Bank of Montreal expects its earnings contribution from the U.S. to keep growing, even without any mergers and acquisitions, driven by a much smaller market share than at home and nearly C$1 trillion ($823.38 billion) of assets, Chief Executive Officer Darryl White said on Monday.

“We do think we have plenty of scale,” and the ability to compete with both banks of similar as well as smaller size, White said at a Morgan Stanley conference, adding that the bank’s U.S. market share is between 1% and 5% based on the business line, versus 10% to 35% in Canada. “And we do it off the scale of our global balance sheet of C$950 billion.”

($1 = 1.2145 Canadian dollars)

 

(Reporting by Nichola Saminather; Editing by Leslie Adler)

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GameStop falls 27% on potential share sale

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Montréal International says foreign direct investment fell 15% in 2020 – Montreal Gazette

Shares of GameStop Corp lost more than a quarter of their value on Thursday and other so-called meme stocks also declined in a sell-off that hit a broad range of names favored by retail investors.

The video game retailer’s shares closed down 27.16% at $220.39, their biggest one-day percentage loss in 11 weeks. The drop came a day after GameStop said in a quarterly report that it may sell up to 5 million new shares, sparking concerns of potential dilution for existing shareholders.

“The threat of dilution from the five million-share sale is the dagger in the hearts of GameStop shareholders,” said Jake Dollarhide, chief executive officer of Longbow Asset Management. “The meme trade is not working today, so logic for at least one day has returned.”

Soaring rallies in the shares of GameStop and AMC Entertainment Holdings over the past month have helped reinvigorate the meme stock frenzy that began earlier this year and fueled big moves in a fresh crop of names popular with investors on forums such as Reddit’s WallStreetBets.

Many of those names traded lower on Thursday, with shares of Clover Health Investments Corp down 15.2%, burger chain Wendy’s falling 3.1% and prison operator Geo Group Inc, one of the more recently minted meme stocks, down nearly 20% after surging more than 38% on Wednesday. AMC shares were off more than 13%.

Worries that other companies could leverage recent stock price gains by announcing share sales may be rippling out to the broader meme stock universe, said Jack Ablin, chief investment officer at Cresset Capital.

AMC last week took advantage of a 400% surge in its share price since mid-May to announce a pair of stock offerings.

“It appears that other companies, like GameStop, are hoping to follow AMC’s lead by issuing shares and otherwise profit from the meme stocks run-up,” Ablin said. “Investors are taking a dim view of that strategy.”

Wedbush Securities on Thursday raised its price target on GameStop to $50, from $39. GameStop will likely sell all 5 million new shares but that amount only represents a “modest” dilution of 7%, Wedbush analysts wrote.

GameStop on Wednesday reported stronger-than-expected earnings, and named the former head of Amazon.com Inc’s Australian business as its chief executive officer.

GameStop’s shares rallied more than 1,600% in January when a surge of buying forced bearish investors to unwind their bets in a phenomenon known as a short squeeze.

The company on Wednesday said the U.S. Securities and Exchange Commission had requested documents and information related to an investigation into that trading.

In the past two weeks, the so-called “meme stocks” have received $1.27 billion of retail inflows, Vanda Research said on Wednesday, matching their January peak.

 

(Reporting by Aaron Saldanha and Sagarika Jaisinghani in Bengaluru and Sinead Carew in New York; Additional reporting by Ira Iosebashvili; Editing by Sriraj Kalluvila, Shounak Dasgupta, Jonathan Oatis and Nick Zieminski)

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