Indeed, despite currency, commodity-market and political troubles, Canada has maintained its position as a top-five destination for global investment, says EY’s latest Canadian Capital Confidence Barometer.
“Last year at this time, only 10% of our Canadian survey respondents saw the Canadian economy improving,” says Doug Jenkinson, partner in EY’s Transaction Advisory Services practice. “This year, that number has jumped to 54%–an impressive increase in a short time.”
As a result, the survey notes the Canadian mergers and acquisitions (M&A) market is expected to remain strong. Says Jenkinson: “Canadian, U.S. and global respondents are bullish on the Canadian and global economy, and that is fueling an appetite for M&A.”
Other findings include:
- More than half (54%) of Canadian respondents believe the domestic economy is improving;
- About the same number (53%) predict the global economy will improve this year, compared with 64% of global respondents; and
- Sixty-two percent are actively pursuing M&A deals, compared with 56% of global respondents
One reason M&A deals are in the cards is many domestic companies are looking at how they can future-proof their businesses, says EY, leading them to look at investing in innovation when it comes to reducing costs and accelerating productivity.
Also, global events aren’t causing as much tension. EY says “recent policy changes introduced by the U.S. administration are not hampering M&A opportunities, with 34% of Canadian respondents believing the policy announcements will in fact create more opportunities.”
It adds, “Further solidifying this notion, more than 75% of Canadian respondents believe Brexit and the rise of anti-EU parties in upcoming European elections will have no impact on their M&A plans in the region.”
Also read: Canada’s M&A appetite remains strong
About EY’s Global Capital Confidence Barometer: The barometer is a biannual survey of executives from large companies around the world and across industry sectors. In March and April, EY surveyed a panel of more than 2,300 executives in 43 countries; 58% were CEOs, CFOs and other C-level executives.