Financial Executives International Canada (FEI Canada)

Financial Executives International Canada (FEI Canada)

March 31, 2009 09:00 ET

FEI Canada Calls for Immediate Action to Restore Confidence in Economy

Calls for increased credit availability to businesses and capital market efficiency

OTTAWA, ONTARIO--(Marketwire - March 31, 2009) - The government must take decisive action to increase the availability of credit to Canadian businesses and to enhance capital market efficiency, according to today's testimony by the Financial Executives International Canada (FEI Canada), before the House of Commons Standing Committee on Finance (FINA), studying measures to enhance credit availability and the stability of the Canadian economy.

"Greater access to long-term credit financing, particularly for small-to-medium businesses, in addition to increasing inter-provincial trade efficiency and establishing a national securities regulator are all critical factors in helping to shape the foundations of a strong Canadian economy and global competitiveness," said Michael Conway, chief executive and national president, FEI Canada. "Increasing overall accessibility of credit to Canadian businesses will facilitate expansion projects and assist corporations in the growth and development of both human capital and market expansion."

FEI Canada's submission to the federal Finance Committee focused on three key areas - increasing Canadian business access to credit, enhancing capital market efficiency and rebuilding confidence in the Canadian economy - all key components necessary to support the achievement of enhanced profitability, capital productivity and overall strengthening of Canada's economy.

The association of Canada's senior-most financial executives encouraged the Department of Finance to examine the tax system with an eye to easing the restructuring burdens on Canadian companies noting, "It is imperative that Canada's tax system supports and enhances the competitiveness of the Canadian economy and ensures its long term prosperity," said Mr. Conway.

Key initiatives to enhance the flow of capital include providing support to the emerging new economy, in the form of start-up capital and follow-on loans to start-up enterprises which focus on innovative new processes and technologies, and green investments. The government was further called upon to provide financial institutions with incentives for granting credit facilities for a period of five plus years.

To improve liquidity and availability of short and long-term funding, FEI Canada called upon the government to assist in the restructuring of the securitization market by ensuring better transparency, accountability and reporting practices.

Recognizing that the government has committed to a range of infrastructure spending, an increase in targeted government spending on high value infrastructure projects was recommended in order to improve efficiency in the flow of goods and services through the economy, while ensuring strong financial management governance is maintained over such spending initiatives.

"To rebuild confidence in the Canadian economy, the government must maintain its debt reduction schedule and show spending restraint by focusing its investments on infrastructure, in sectors such as transportation, education and training and research and development, which together will drive growth and improve productivity," Conway concluded.

In drawing together the recommendations proposed to the Expert Panel, FEI Canada conducted a survey of its more than 2,000 members across Canada, representing a range of industry sectors. With this input, FEI Canada's Credit Availability Task Force formulated the recommendations which have been put forward to the Standing Committee on Finance.

A copy of FEI Canada's recommendations can be found at FEI Canada Credit Availability Recommendations.

About FEI Canada

FEI Canada is the all-industry professional membership association for senior financial executives. With eleven chapters across Canada and more than 2,000 members, FEI Canada provides professional development, thought leadership and advocacy services to its members. The association membership, which consists of Chief Financial Officers, Audit Committee Directors and senior executives in the Finance, Controller, Treasury and Taxation functions, represents a significant number of Canada's leading and most influential corporations. Further information can be found at www.feicanada.org.

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