Canada: Selected Issues and Analytical Notes

July 13, 2017

Preview Citation

Format: Chicago

Canada: Selected Issues and Analytical Notes, (USA: International Monetary Fund, 2017) accessed November 8, 2024

Summary

This paper describes the proposed Canada Infrastructure Bank (CIB) that will be allocated Can$35 billion over an 11-year period. It will add to, and not replace, existing methods of financing public infrastructure at all levels of government, including the Federal Government’s Can$187 billion Investing in Canada plan covering 12 years. The CIB will be a wholly government-owned Crown corporation, subject to provisions of the Financial Administration Act (FAA), including the requirement to prepare a corporate plan, operating budget, and capital budget, for approval by the Government. The CIB and its investments will be on the federal government’s balance sheet. However, the infrastructure-related special purpose vehicles (SPVs) in which the CIB invests will not be on the government’s balance sheet. Attracting private capital requires offering a rate of return acceptable to the investor. Worldwide, there are trillions of dollars looking for safe returns over the long-term. The risk-adjusted rate of return sufficient to attract an investor is not known with precision ex-ante. Investors will seek the highest rate of return possible above its minimum threshold.

Subject: Financial institutions, Financial sector policy and analysis, Housing prices, Infrastructure, Macroprudential policy instruments, Mortgages, National accounts, Prices, Taxes, Transaction tax

Keywords: Australia and New Zealand, CIB investment, CR, Credit growth, Global, House price growth, Housing prices, Infrastructure, Infrastructure assets, Infrastructure investment, ISCR, LTV ratio, Macroprudential policy instruments, Mortgage credit growth, Mortgages, Stamp duty, Transaction tax

Publication Details

Pages:

62
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2017/211
Stock No:

1CANEA2017002
ISBN:

9781484309650
ISSN:

1934-7685

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