Investissement Québec (IQ) will file an annual report next week, which will probably be written in red ink because of the pandemic. Its big boss is nevertheless delighted that companies are slowly starting to launch new projects.
The crown corporation was due to file its financial statements in the spring, but the crisis prevented it. Its financial year has ended since the end of March.
“March 31, 2020 was probably the worst time to take a family photo,” Guy LeBlanc, CEO of IQ, remarked yesterday in a telephone interview with Le Journal .
The Business Development Bank of Canada and PSP Investments, federal institutions run out of Montreal, both posted negative returns for their years ending March 31.
More flexible return target
Fortunately for IQ, Minister Pierre Fitzgibbon's reform, which came into effect last year, allows the organization to spread over a period of three to five years the achievement of its performance target. It is currently around 2% per year, which is what it costs the government to borrow.
“Our objective is to have the most impact possible and to take more risks for projects which are promising, but which are not guaranteed to generate the profits required to repay the debt or the capital stock” , explained Mr. LeBlanc.
Noting that the economic situation is gradually improving, the leader is optimistic that IQ's performance will be better in 2020-2021, but he does not make any promises.
“We do not know what will happen with the second wave” of the coronavirus, he said at the microphone of the podcast Mind your business on QUB radio.
Another $ 1 billion for the crisis
IQ still has ammo. A sum of $ 1 billion is still available in the government's PACTE program, which aims to help companies get through the crisis. Some $ 1.5 billion has been awarded so far.
“If it is necessary to add funds, I am convinced that the government will follow,” he maintained.
But beyond emergency aid, the phone has started ringing again for growth projects.
“Compared to three months ago, there is a lot more appetite to invest, and the number of requests we have for projects is continuously increasing,” said Guy LeBlanc.
Productivity innovation initiative
IQ yesterday unveiled the Productivity Innovation initiative, with an envelope of $ 2.4 billion by 2023.
The first version of the program, launched under the name “Innovative Manufacturers” in 2016, has made it possible to finance more than 1,100 projects. IQ invested $ 2.4 billion in it, 2.5 times more than expected. Including contributions from companies, investments totaled $ 8.5 billion.
This time around, all businesses that revolve around manufacturing are eligible, including retailers as well as transportation, warehousing, construction and professional services firms.
Aeronautics is also in the crosshairs, but IQ does not believe it can save this industry hit hard by the pandemic on its own.
“It is clearly up to the federal government to set up an assistance program for businesses in the sector,” said Mr. LeBlanc. We can't wait to see this program emerge on the horizon. ”