Quebec economy minister says it's 'naive' to think we can succeed without subsidies for batteries

Quebec Economy and Innovation Minister Pierre Fitzgibbon speaks as Volta Energy Solutions, launches the first copper foil plant in Granby, Que., Tuesday, Sept. 5, 2023. THE CANADIAN PRESS/Christinne Muschi

Economy Minister Pierre Fitzgibbon has come to the defence of subsidies paid to foreign companies to develop the battery industry.

On Thursday, National Bank president and CEO Laurent Ferreira criticized government subsidies paid to foreign companies, in particular to develop the battery industry.

"My point is that when we give subsidies to foreign companies, they go directly into the pockets of foreign shareholders who are mainly non-Canadian," said Ferreira in an interview on Thursday, on the sidelines of a presentation to the Montreal Metropolitan Chamber of Commerce (CCMM). "I have my doubts about this model, in the longer term, in terms of wealth creation."

Fitzgibbon "respectfully" reacted to the businessman's comments at a press scrum the following day in Bromont. He replied that the National Bank boss "does not appreciate the role of government."

"If there were no government subsidies, there would be no battery industry in Canada. It would be in the United States," he said.

The minister believes that the philosophical debate between the advocates of laissez-faire and interventionism is an interesting one.

"What the Quebec government has decided to do, and we believe in it, is to say, 'let's choose the sectors where it's worthwhile,'" he said. "People who think that in Quebec we shouldn't do anything, people (companies) will come (anyway), it's naive (to believe so)."

Later on 'X,' the minister added that he saw the "world in the same way" when he himself was working at the National Bank in the 2000s.

His experience in government convinced him that the province had to be "aggressive" and make "targeted offers."

"We must not be fooled into giving too much, but we will never close the wealth gap simply by applying academic theories," he said.

Ferreira's speech comes at a time when governments are spending billions of dollars to attract foreign companies to the battery industry.

Canada could spend nearly $13 billion on Volkswagen's project to build a battery plant for electric vehicles in St. Thomas, Ont. Aid to Stellantis could reach $15 billion for its battery plant in Windsor.

Quebec is not to be outdone.

Ottawa and Quebec have granted $640 million in aid for Ford's Bécancour plant. The GM-Posco plant received almost $300 million from both levels of government.

The Legault government is reportedly on the verge of making the construction of a project by Swedish cell manufacturer Northvolt in the Vallée-du-Richelieu official, and significant budgetary support is anticipated.

Fitzgibbon referred to this announcement without naming it.

"If the announcement is made next week, as we think it will be, I won't divulge it in advance, but I'll come back with figures to show what the impact of this sector will be," he said.

This report by The Canadian Press was first published in French on Sept. 22, 2023.