Separation ‘not something we need as a country or province’: analyst

Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce, joins Alberta Primetime's Michael Higgins to discuss concerns around the referendum.

Reaction is coming in from Alberta’s big city mayors to the Smith government advancing a question on separation to the Oct. 19 referendum, fearing it could fuel economic uncertainty for years to come. Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce, joins Alberta Primetime’s Michael Higgins to discuss the rising concerns.

This interview has been edited for clarity and length.

Michael Higgins: You’ve told us previously about concern over separation dialog. What degree of impact do you see coming with the introduction now of an actual referendum question?

Deborah Yedlin: I think all of a sudden people realize that this is not something in the abstract that could move forward. It is moving forward with a confusing question, but it’s interesting to see how we’ve already seen the launch of a couple of initiatives other than Thomas Lukaszuks’. One with Monte Solberg, a former MP, and Jason Kenney, the former premier, as well as another initiative that involves both two former finance ministers, Jim Dinning and Travis Toews. Clearly there is concern about the uncertainty that this casts.

I think the biggest thing to remember is we are already dealing with the biggest trade shock as a result of what the U.S. wants to do. On top of a war in the Middle East that has caught playing havoc with energy prices and we don’t need anything else to add to the uncertainty pile. But this is exactly what’s taking place with this decision to go ahead with the referendum and we’re just making our own weather that we just really don’t need to do.

MH: Why would this be such an inflection point? What is it about the question that makes it so destabilizing now?

DY: We have to look at a couple of examples. Obviously one is Brexit, where there was a sense that if the U.K. separated from the EU (European Union), it would have more money and that it would be better for economic growth. Neither have been proven to be the case. Foreign investment fell by almost 18 per cent in the U.K., as well as the economy decreasing in terms of I think at six to eight per cent, rather than the three or four per cent that was advertised.

The second thing is we look at the Quebec conversation. For two years running up to the Quebec referendum, the Quebec government could not sell provincial bonds because of the uncertainty associated with the looming referendum. We know that prior to that, when René Lévesque was in power, 700 companies left Quebec. There’s a reason why the Bank of Montreal is headquartered in Toronto and upwards of 40,000 people left in one year. Even the prospect of the uncertainty causes people to leave, that compromises investment, it compromises economic growth, it compromises productivity, and to what end?

MH: We heard big city mayors reflecting on the impact already showing itself. What are you hearing?

DY: We’re hearing that in some cases people have said, “I was going to invest more in Calgary. I was going to invest more in Alberta. I’m just going to wait and see what happens before I make any commitments.” From a business standpoint, we’re hearing a lot of conversations behind the scenes about the concern that this represents for businesses broadly speaking. I think when we look at it in a broader context, we are two to three per cent of the global capital markets. Our industries over the decades have grown by attracting foreign investment.

That has dried up partly because of the challenging regulatory environment, but also because we had a very low pricing environment in the energy space for a while, up until about 2020, when prices did start to recover. We need to make sure that we are presenting ourselves as a stable jurisdiction for investment. Capital goes to where it gets the best return and if there’s another place that has a lower risk premium to it, then perhaps that’s where the capital is going to go. We don’t need to add to the uncertainty pile that already exists.

MH: Your members heard from Alberta’s environment minister on Tuesday. Grant Hunter, I believe, told you he isn’t worried about the referendum having an impact on efforts to secure a new pipeline to the coast. What do you make of the government’s confidence in that regard?

DY: I think they’re looking at the numbers that the polling folks have been releasing, saying that thirty per cent want to leave and that’s pretty stable. The concern is there are people who still believe that we need to send a message to Ottawa and my response to that is we have a different government in Ottawa. The old government’s gone. Steven Guilbeault resigned today, hallelujah, and we are moving forward with an MOU (memorandum of understanding) with the pipeline. What we need is the certainty for investment to fill that pipeline, so let’s get there. But if you have something hanging over from an uncertainty perspective, there’s going to be times waiting on the sidelines waiting to see what you can do going forward.

MH: Has anyone presented to the Calgary Chamber a credible argument for how or why independence would put Alberta’s business community in a better position?

DY: No and I think it’s really important to realize that a lot of the things that are being put forward don’t really hold the economic water that some of the people that are putting those statements forward actually hold. It is a completely unworkable solution. We have interprovincial trade issues and if you’re a country that is faced with two other provinces on either side, it’s not going to be easy to negotiate your access. As a province, you have to provide all the services that you get from the federal government already. This is not something that results in increased prosperity for Albertans and anybody who’s trying to tell them that that’s the case, is lying.

MH: As you mentioned earlier, a number of pro-Canada campaigns are already emerging. How do you see the business community responding to that? Is that something business leaders will actively engage in?

DY: Now that the question has been tabled and there’s organizations that are coming together to push back, we will see more of a voice from the business community. I think it’s also instructive that even though we talk about the potential for a referendum happening in Quebec as a result of the election in the fall, the business community in Quebec is dead set against another referendum because of the experience that they had in Quebec following the two referenda that were held, so they know what the damage looks like.

They don’t want to go back there again. I think that’s something we all have to pay attention to. Whether it’s the Chamber of Commerce, it’s business, it’s everybody, this is not something we need as a country or as a province. Even as there are issues that people feel need to be aired, those issues do not warrant the breakup of a country.

MH: What is the message that you’re sending to the Smith government, now that this question is out? Is it that you don’t want the referendum period?

DY: In the best of all possible worlds? Yes, this is not something that is constructive. It is going to consume a lot of energy and time between now and October, at a time when we really need to think about getting back to basics. Let’s make sure that we’re meeting the needs of Albertans. Let’s make sure that the government is acting in a way that supports the needs. Whether it’s health care, education, social services, we need to get back to basics. There’s no way you can cast this as being a helpful initiative. In the best of all worlds, it disappears. Whether that’s realistic or not, I don’t know, but we really need to see Alberta stay in the country.