Wednesday April 23, 2014


question of the week

Survey results are meant for general information only, and are not based on recognised statistical methods.





Home »  News »  Business

Ontario in for stagnant growth if companies don't spend 'dead cash:' report

TORONTO - A new report says Ontario businesses need to start spending the "dead cash" languishing in coffers if the province wants to prevent "slow or stagnant" economic growth.

The Task Force on Competitiveness, Productivity and Economic Progress says Ontario's economy can no longer afford for companies to hold onto "larger cash balances" instead of investing the money to trigger more productivity.

"Companies need to step up their efforts to grow the economy, and counterbalance risk by producing higher returns," urged the 74-page report released on Thursday, titled A Push for Growth: The Time is Now.

"Given the higher level of cash balances, this is the time to turn this situation around and for companies to innovate and invest in productivity-enhancing projects."

The task force was created in 2001 by the Ontario government to monitor economic progress compared to the other provinces and the United States.

In 2000, Ontario ranked 15th in GDP per capita among its North American peer jurisdictions. In 2011, it came in at 14th.

Bank of Canada governor Mark Carney raised the issue of large cash reserves on Canadian companies' balance sheets in the summer and suggested that it be spent, or returned to shareholders through dividends, given Canada's economic stability.

The task force adds that now is a good time to stimulate growth due to a "sound banking system, a strong housing market and a robust dollar."

If businesses continue to sit on its cash reserves, then growth in the province will "languish for the next eight to 10 years," projects the report.

"Ontario has made some good progress over the past decade," said task force chairman Roger L. Martin, who is also dean of the Rotman School of Management at the University of Toronto.

"However, good is not good enough anymore."


Comments


NOTE: To post a comment in the new commenting system you must have an account with at least one of the following services: Disqus, Facebook, Twitter, Yahoo, OpenID. You may then login using your account credentials for that service. If you do not already have an account you may register a new profile with Disqus by first clicking the "Post as" button and then the link: "Don't have one? Register a new profile".

The Coast Reporter welcomes your opinions and comments. We do not allow personal attacks, offensive language or unsubstantiated allegations. We reserve the right to edit comments for length, style, legality and taste and reproduce them in print, electronic or otherwise. For further information, please contact the editor or publisher, or see our Terms and Conditions.

blog comments powered by Disqus


About Us | Advertising | Contact Us | Sitemap / RSS   Glacier Community Media: www.glaciermedia.ca    © Copyright 2014 Glacier Community Media | User Agreement & Privacy Policy
Business in Vancouver Whistler Question Squamish Chief Powell River Peak Real Estate Weekly My Local Flyers

LOG IN



Lost your password?