By COLLIN GALLANT on December 26, 2019.
Pictured: An artists rendering that imagines the visual impact of the construction oft he Suncor Forty Mile Wind power facility.–submitted photo Suncor The view is facing north west from Highway No. 885 near the Forty Mile Reservoir.
With one complete and nine other major green power projects ready to roll, renewable energy development and its $2 billion investment in Southeast Alberta is the business story of the year in Southeast Alberta for 2019.
Most of that activity will roll out over the next two years, still it was the most encouraging story over what’s been a rocky 12 months for the local economy.
The shallow natural gas sector continued to shudder as the province announced special tax relief on unprofitable wells. In a landmark shift, the City of Medicine Hat announced it would close about 80 per cent of its production to stem loses.
Business owners gained a spring in their step with the election of the United Conservatives in the April provincial Election. But consumer confidence across the province dipped late in the year as high unemployment lingered.
In another jarring hit for local outlook, Aurora Cannabis announced it would delay fully commissioning its massive marijuana growing facility until 2021.
Other efforts moved forward, but little went as smoothly as Capital Power’s building its $350-million wind farm near Bow Island. That project went online in early December after employing more than 300 workers at its height, filling hotels and restaurants this past year.
Estimates vary about what portion construction budgets are spent locally, but even at the lowest estimate, the influx of cash would rival the annual payroll of CFB Suffield.
And construction budgets totalling another $1.6 billion in total construction has been approved for the next two years throughout Southeast Alberta.
The year was bookended by major companies announcing they would proceed with substantial projects.
Suncor, Berkshire Hathaway Energy Canada, Power Corp., European utility giants Innogy and EDF all gave regional projects the greenlight.
Using figures the Lethbridge-based Southern Alberta Alternative Energy Partnership, estimates for annual local impact from the area wind projects alone at $12.5 million per year in new local taxes and $3.1 million paid to landowners for land lease agreements.
A commercial construction boom wound to a close in the city’s south end, with new commercial plazas, a car dealership and seniors’ living complex,
In the vicinity, the Save-On-Foods grocery store opened after a year-long delay and replaced the former Walmart Supercentre that was demolished after 10 years on the market.
Municipal commercial land sales soared as the city development office marketed and sold a half dozen properties considered excess to municipal needs. Major projects could be permitted in 2020, including a downtown hotel, a multi-family housing project on the site of the Medicine Hat Arena, a condo complex in Connaught,
Commercial land sales roared, while the residential sector snored.
Building permits to November, show only 19 new home permits were issued to that point, down from 46 in 2018, and a recent high of 100 in 2015.
At the same time, Calgary-based developer Enclave ventures announced it and local partners would build the Coulee Ridge Community on land in the city’s southwest.
The Alberta Advantage
The big win for the United Conservatives was enthusiastically received by the broad business community. The new government announced changes to corporate income tax, labour standards on farms, youth minimum wage and promises to revisits the entire labour code next year.
Mixed year for majors
Cancarb rang in 2019 by announcing a $40-million expansion to their production of rubber additive carbon black, but Methanex moved ahead with major expansion in Louisiana rather than a proposal to twin the local methanol facility.
Aurora announced it would slow down commissioning its massive greenhouse, waiting to bring it fully on line until consumer demand warranted, possibly in 2021.
Folium Bioscience announced its intention to build a local processing plant for hemp derivatives in early January.
Hut 8 Cryptocurrency increased the size of a electricity buy from the city utility to power its data-processing centre in the city’s northwest.
Big Marble Greenhouse, a traditional vegetable outfit, announced it planned to add 10 acres to its site south of the city near Highway No. 3.
In wider agriculture farmers and ranchers were vexed with dry spring and summer, then an early damaging frost and freezing conditions – events across the prairies that earned separate spots on Environment Canada’s top-10 weather stories of 2019.
That’s on top of trade tension with China over canola, while other specialty crop growers were hampered.
Lantic Sugar announced in early November that about half the sugar beet crop would be left in the ground.
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Stocks gain as earnings provide some optimism; 10-yr yield climbs
Stock indexes around the world jumped on Tuesday as U.S. technology shares extended recent gains and earnings reports were upbeat, while the 10-year U.S. Treasury yield rose to its highest in more than four months.
The U.S. dollar was lower on the day as other currencies, including sterling, were supported by investor expectations that interest rates could be increased sooner than some had forecast.
On Wall Street, the technology sector boosted the S&P 500 the most, while recent stronger-than-expected results have bumped up the forecast for S&P 500 earnings for the third quarter.
Investors remain worried, however, about the impact that higher costs, supply disruptions and labor shortages are having on companies.
“The key for the market to going up from here will not be higher multiples, it will have to be higher earnings. That’s why it’s so important to pay attention to what those profit margins do going forward and what the trajectory of GDP looks like,” said Eric Marshall, portfolio manager at Hodges Funds.
Among U.S. companies reporting results on Tuesday, insurer Travelers Cos Inc beat estimates for third-quarter profit and its shares rose. Johnson & Johnson raised its 2021 adjusted profit forecast and its shares jumped 2.3%.
The Dow Jones Industrial Average rose 198.7 points, or 0.56%, to 35,457.31, the S&P 500 gained 33.17 points, or 0.74%, to 4,519.63 and the Nasdaq Composite added 107.28 points, or 0.71%, to 15,129.09.
The pan-European STOXX 600 index rose 0.33% and MSCI’s gauge of stocks across the globe < .MIWD00000PUS> gained 0.73%.
The MSCI index reached its highest in about a month.
MSCI World Index https://fingfx.thomsonreuters.com/gfx/mkt/zgvomrjmavd/world%20stocks%20oct%2019.PNG
The dollar index against a basket of other currencies was last down 0.22% on the day at 93.73, after earlier dropping to 93.50, the lowest since Sept. 28.
The euro gained 0.25% to $1.1640. Currencies, including sterling and the New Zealand dollar, are benefiting from rising interest rate increase expectations.
Bitcoin last rose 3.49% to $64,201.08.
In the U.S. Treasury market, the yield curve widened, reversing the recent trend.
In afternoon U.S. trading, U.S. 10-year yields were last up nearly six basis points at 1.6407%. The yield hit a 4-1/2-month peak of 1.6440%.
The U.S. 5-year yield, which has been on a tear the last two weeks, was last down at 1.1586%.
Oil prices climbed and were near multi-year highs as an energy supply crunch continued across the globe. Brent crude rose 75 cents to settle at $85.08 a barrel. U.S. West Texas Intermediate (WTI) futures rose 52 cents to settle at $82.96.
In other commodities, U.S. gold futures gained 0.15% to $1,769.70 an ounce.
(Additional reporting by Tommy Wilkes in London, Shreyashi Sanyal and Devik Jain in Bengaluru, Karen Brettell, Stephanie Kelly and Sinead Carew in New York, and Saikat Chatterjee; Editing by Jason Neely, John Stonestreet, Steve Orlofsky and Cynthia Osterman)
In highly uneven recovery, global investment flows rebound – UN News
It shows the increase in the first two quarters in FDI, recovered more than 70 per cent of the losses stemming from the COVID-19 crisis in 2020.
For the UNCTAD‘s director of investment and enterprise, James Zhan, the good news “masks the growing divergence in FDI flows between developed and developing economies, as well as the lag in a broad-based recovery of the greenfield investment in productive capacity.”
Mr. Zhan also warns that “uncertainties remain abundant”.
The duration of the health crisis, the pace of vaccinations, especially in developing countries, and the speed of implementation of infrastructure stimulus, remain important factors of uncertainty.
Other important risk factors are labour and supply chain bottlenecks, rising energy prices and inflationary pressures.
Despite these challenges, the global outlook for the full year has improved from earlier projections.
The growth in the next few months should be more muted than the in the first half of the year, but it should still take FDI flows to beyond pre-pandemic levels.
Between January and June, developed economies saw the biggest rise, with FDI reaching an estimated $424 billion, more than three times the exceptionally low level in 2020.
In Europe, several large economies saw sizeable increases, on average remaining only 5 per cent below pre-pandemic quarterly levels.
Inflows in the United States were up by 90 per cent, driven by a surge in cross-border mergers and acquisitions.
FDI flows in developing economies also increased significantly, totalling $427 billion in the first half of the year.
There was a growth acceleration in east and southeast Asia (25 per cent), a recovery to near pre-pandemic levels in Central and South America, and upticks in several other regional economies across Africa and West and Central Asia.
Of the total recovery increase, 75 per cent was recorded in developed economies.
High-income countries more than doubled quarterly FDI inflows from rock bottom 2020 levels, middle-income economies saw a 30 per cent increase, and low-income economies a further nine per cent decline.
Mixed picture for investors
Growing investor confidence is most apparent in infrastructure, boosted by favourable long-term financing conditions, recovery stimulus packages and overseas investment programmes.
International project finance deals were up 32 per cent in number, and 74 per cent in value terms. Sizeable increases happened in most high-income regions and in Asia and South America.
In contrast, UNCTAD says investor confidence in industry and value chains remains shaky. Greenfield investment project announcements continued their downward path, decreasing 13 per cent in number and 11 per cent in value until the end of September.
The combined value of announced greenfield investments and project finance deals rose by 60 per cent, but mostly because of a small number of very large deals in the power sector.
International project finance in renewable energy and utilities continues to be the strongest growth sector.
The investment in projects relevant to the SDGs in least developed countries continued to decline precipitously. New greenfield project announcements fell by 51 per cent, and infrastructure project finance deals by 47 per cent. Both had already fallen 28 per cent last year.
Simon Kronenfeld: Best Performing Stocks on TSX in 2021
Simon Kronenfeld is well-experienced in analyzing stocks across North American markets. Recently he has turned his attention to the Toronto Stock Exchange in particular. Although less liquid than US exchanges, there remains strong potential for reliable returns if you know your way around the TSX. Spotting the stocks with the potential to survive and thrive in changing times will be a key skill in 2021.
Simon Kronenfeld dwells upon three companies that are performing well on the TSX in 2021.
- Goeasy Ltd: Goeasy’s success is a reflection of the wider financial sector in general. The company primarily offers loans for home appliances and furniture through their easyHome and easyFinancial divisions.
The company has issued around $5 billion in loans to date, and they continue to help Canadian borrower’s build their credit scores, with 60% of customers increasing their credit scores within a year. Despite the pandemic, the company’s stocks have continued to deliver great returns over the last year. In fact, its share prices have risen 210% since August 2020. Considering the wider economy, Goeasy is looking like a sound investment for the future.
- TFI International: TFI International had some negative news at the start of the year as its stock prices slipped, but they have bounced back to triple the value of that period. These temporary dips are not a major obstacle for smart companies with the right plan.
TFI International is a logistics company with over 500 access points across North America. This company covers all the major sectors of the industry, including Package and Courier, Truckload, and Logistics, and provides more than 31,000 jobs.
The company recently acquired UPS’s Less-Than-Truckload freight service, which has led to a major transformation in their revenue distribution. Now the company predicts 75% of their revenue to come from the US market, where there is more growth potential. Simon expects to see long-term growth and value from this one, despite the stock price boost it has already experienced.
The company has made major improvements to its efficiency following the acquisition, putting it on the right path to make further inroads into the US market.
- Shopify: Shopify is the most widely-used e-commerce marketing platform, used by small businesses and major operations alike to create online stores and sell products, thanks to its streamlined design process and in-built payment platform.
Business was already booming for Shopify before the pandemic, and the shift towards online shopping in the last year has only served to compound its successes. As a result, it has experience growth of 32% in the last year, and Simon expects this trend to continue.
Simon Kronenfeld is not only a businessman, he is also a business expert in today’s world. He founded the company Electronic Liquidators Inc. in 1999 and paving the way for many opportunities as he sold it and made his way into real estate. Now after 2 decades, Simon Kronenfeld is a real estate mastermind who plans to build luxury housing by the beach. If we think about what the driving force behind Simon Kronenfeld’s success has been, we can say that it is his self-motivation to do better.
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