Catching up with Ian G. McKay,
CEO of Invest in Canada

Canada and Japan share equally strong diplomatic and financial ties. Japan is Canada’s fourth-largest trading partner, and its largest Asian source of foreign direct investment. As of 2016, there were about 450 Japanese subsidiaries and affiliate companies operating in Canada involved in everything from cars and supercomputers to mining and life sciences.

Someone who understands the multifaceted connections between Canada and Japan far better than most is Ian G. McKay. The native of Penticton, British Columbia, has worked as an executive in international finance markets, advised federal cabinet ministers, served as the CEO for the Vancouver Economic Commission and recently served as a special envoy on behalf of Canadian Prime Minister Justin Trudeau to assist in the negotiations for the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). In March, he was appointed CEO of Invest in Canada, a federal investment promotion agency that seeks to facilitate global business investment in Canada.

McKay is also no stranger to Japan. He has a degree in Asian Studies from the University of British Columbia, is fluent in Japanese, and worked as managing director for 12 years with an international brokerage firm in Tokyo. During his October visit to Tokyo, in part for the Canada IN3 Seminar held at the Embassy of Canada to Japan in Tokyo, we were able to speak to him about what he learned during his time in Japan, the role he played in the CPTPP negotiations and the potential for Japanese investment in Canada.

I know you have a very strong connection to Japan. What are some of your favourite places in the country?

First of all I love Tokyo. I think it’s an unbelievable city. I’ve seen it grow since I was first here in 1980. I have a strong affinity for so many different parts of the city — the food, the architecture, the people. But outside of Tokyo my favourite place is Shimoda [in Shizuoka Prefecture], where I spent many summers at our beach house.

During your time with Euro Brokers Inc. in Japan, what did you learn about doing business here?

Be prepared, work hard, build relationships and be reliable. If you follow those four things in Japan, you’re going to do okay.

Are there any lessons you learned working in Japan that you carry with you to this day?

That’s a great question. That was really my first professional experience. I came right out of school to go to New York and then come to Tokyo. I just think that the value of hard work is something that should be part of our lifelong learning, and something that we should carry with us all the time.

Of what achievements are you most proud from your time as a senior policy advisor to the Canadian federal government?

I worked for the minister of industry, which is really the business ministry in the Canadian government, and I think we made a lot of progress on some of the automotive files. We recruited some investment from both Toyota and Honda to Canada at that time. This is now about 15 years ago; we were starting to brand Canada in some new markets such as Japan and parts of Europe where we hadn’t done a lot of work. I was really happy to be a part of that exploratory time before Invest in Canada was created.

Can you talk at all about your role as special envoy during the negotiations for what became the CPTPP?

It was a political role, so I can’t get into the details of the negotiations, but clearly Canada was in a position where we stumbled a little bit in our relationship with Japan. My role was to reengage at the political level and regain the conversation, so we could get to a spot where we were discussing on a daily basis how we were going to get to a deal. It was really rebuilding a relationship at the political level and setting the stage so our teams could finally cross the t’s and dot the i’s. It was a formidable experience; it was a life experience for sure.

The province of Ontario is home to the Advanced Manufacturing Supercluster.

Although you have only been CEO of Invest in Canada for a short time, has it already reached some milestones?

One of the first things we did, even before I was able to hire a lot of staff members, was bring in the company WeWork from New York City. WeWork had met with the prime minister earlier this year and they had committed to doing something more in Canada.

We did at that time what I think our organization will be doing a lot of, which is bringing in a major company and putting them together in a room with all the major stakeholders they needed to see at the same time. We invited municipal partners and introduced them to a number of federal cabinet ministers and their staff with whom they need to engage.

It was a one-stop shopping facilitation for a major New York-based firm who had committed to expanding in Canada, and I think that was a really good start for the business model that we should be developing.

What are the key components of the foreign direct investment strategy that Invest in Canada is implementing?

We start with research. Research will be an engine of all the activities that we pursue, so that we are not taking a spray and pray approach. We are going to be very focused and targeted in the sources of capital that we are pursuing and the sectors to which we are directing the capital to be flowed, so research is the starting point.

From there we are building a very robust marketing and communications branding team. Canada really needs to get its story out in a more aggressive fashion, so that is the second business unit.

And of course, the investor services division is the one we are fleshing out now and that is where we have a team of people that work hand-in-hand with companies and investors, from their earliest concept to the completion, and then the aftercare of the investment. Those are the three stages by which we are going to be building out the organization.

I imagine that the main targets for foreign investment in Canada are going to be the major cities, but is there any push to drive investment into rural areas as well?

We have a recent example of how important rural Canada is to our investment landscape. On October 1, LNG Canada announced the largest-ever private-sector investment into Canada, a C$40 billion project [Mitsubishi Corporation is a 15 per cent partner in the project].

LNG Canada is the largest-ever private-sector investment into Canada.

It is going to a town called Kitimat on the northwest coast of British Columbia. The big cities are important for sure, but let’s be clear: the biggest investment ever in Canada is going to northern British Columbia, starting in Alberta, through the Rockies, through the coastal mountains, to the beautiful west coast of Kitimat.

Why do you think Canada and Japan have such strong ties?

You know, it’s really a beautiful relationship. We are 90 years into the bilateral diplomatic relationship. We are both Pacific nations. I think Canada was maybe a little bit late in recog-nizing that we are a Pacific nation, but we are very strongly tied to the Asia–Pacific region. And I think we have a mutual understanding.

We are both peace-loving nations. We both have a high regard for bustling, robust cities and beautiful open nature. So I think we have far more in common than we have that sets us apart. I think the 90 years of very solid diplomatic relationships, and the embassy here — which is easily the most prominent embassy in all of Tokyo — is a really strong signal for that relationship.

“I think the future of trade and investment between Canada and Japan and trade investment and friendship will be extraordinary.”

What would you say are the strongest reasons that Japanese business should continue to invest in Canada?

Diversification is one thing that we are trying to offer major investor groups like those in Japan. Like much of the world, Japan is going through a decade-and-a-half cycle of very, very low interest rates and I think it is incumbent upon some of the capital in Japan to look beyond its borders, to look beyond Asia to see some of the oppor-tunities that exist in Canada.

Japan is already in Canada in the resource sector, in the manufactu-ring sector and in the life sciences sector, and we would like to invite them to explore other prominent sectors where they have expertise, where they have needs, and where they have investment interest.

Which Canadian business sectors have the greatest potential for investment from Japan?

I think it will continue in advanced manufacturing, and it will continue in the resource sector. I think there are extraordinary oppor-tunities within the supercluster framework that is emerging in Canada: in the digital economy, in artificial intelligence, in quantum computing, in farming and agriculture, agricultural technology, bioproteins and in ocean sciences.

I think there is a wide array of emerging investment projects in Canada that will be of interest to Japanese investors. I know they are of interest because the Japanese side has told me, in a major way. We just have to put the two together and let the magic happen.

How might the CPTPP boost Japanese investment in Canada?

We certainly look forward to the ratification in Canada later this fall. I think there will be an immediate impact in the agriculture industry, the dairy industry and in the mining industries. I think Japan will see that any time a tariff goes down, it enhances the investment pro-position for them, so I think it is going to be a really wonderful outcome.

Do you have any message for the readers of The Canadian and members of the CCCJ?

A couple of things. One is keep up the good work. I think the future of trade and investment between Canada and Japan, and trade investment and friendship will be extraordinary. I think it is important that people recognize the work that folks are doing here at the Embassy of Canada to Japan in Tokyo is really a foundation of what Invest in Canada is aiming to do.

We’re in an office in Ottawa, and without the resources on the ground in key markets such as Tokyo, we wouldn’t have much to talk about. So, I think members in the chamber here in Japan should continue to work hard to build their commerce, build their businesses and use the resources at the embassy because they are an extraordinary group of people.

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