Canada wins in KPMG’s competitiveness ranking

Canada was a clear winner in this contest, though whether it was worth winning is in question.

KPMG LLP recently declared Canada the winner of its Competitive

Alternatives study. According to the study’s co-author, Stuart MacKay, the 10-month research program covered more than 85 cities throughout Europe, Canada, the United States, and Japan. The basis for comparison is the after-tax cost of startup and operation for 12 specific types of business, over a 10-year time horizon.

For the study, cities were grouped into one of three types: emerging (Calgary and Ottawa), restructuring (Halifax and Kelowna) and mature (Toronto and Montreal). They were then compared against their international counterparts based on 27 elements like taxes, wages, and transportation and utility costs.

While no one seems to be questioning the result, CATAlliance president John Reid wants to make one ting clear: “”I don’t think the conclusion should be we have a competitive advantage.”” He also doubts it will be the deciding factor in the decision-making process of where to set up shop.

“”I think they (corporations) use multiple sources of information and it would be interesting to look at where some of the new investments are being made and why they are being made there,”” Reid says.

Information Technology Association of Canada president Gaylen Duncan holds a similar view, and worries about what the result means.

“”I don’t think it will be the decision maker, but will it have influence — yes,”” Duncan says. “”I think the one concerning point is that the real reason why Canada ranks where it does is wages and salaries, and that’s not a sustainable situation. Over the long term that has to change.””

MacKay says there is an online version of the tool used to crunch the data. He says it can be used with any of the 12 business operations used in the study. He says a licenced version where users can customize data should be available soon.

Duncan says the tool could be of use.

“”I think if I was sitting on top of a couple of hundred million dollars deciding where to locate a plant this is the kind of additional information that would be very useful,”” he says “”I certainly wouldn’t only rely on this, but any inter-jurisdictional analysis done by an independent group–that is not done by the government of that nation–I think is informative. Persuasive? Not sure.””

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