Quebec has lost its economic ambition, high-profile business leaders say

A group of high-profile business leaders is calling on Quebec’s future government to take bolder action to foster growth and build collective wealth, saying the province has lost its economic ambition and is drifting further and further behind other jurisdictions in many aspects of daily life.

Billionaire Andrew Lutfy, owner and chief executive of fashion retailer Groupe Dynamite Inc. GRGD-T, is spearheading the corporate appeal, which comes three days before Quebec’s provincial election. He’s joined by Alain Bouchard, founder and chairman of convenience giant Alimentation Couche-Tard Inc. ATD-T, Laurent Beaudoin, whose family built Bombardier Inc. BBD-B-T, and Paul Desmarais III, senior vice-president of Power Corporation of Canada POW-T.

“The more wealth Quebec creates, the more choices it will have, the more capacity it will have to invest, to get through harder times, to finance its priorities, to decide its own fate,” Mr. Lutfy said during a speech at Montreal’s Four Seasons Hotel on Friday, which was attended by about 400 Quebec Inc. executives and entrepreneurs. He said Quebeckers shy away from talking about wealth but shouldn’t if they want to stop thinking small.

It’s rare for business leaders in Quebec to go public with their concerns and even rarer for them to do so at such a sensitive time, just ahead of a provincial vote. The separatist Parti Québécois is poised to win power on Monday, bringing an end to eight years of government under the Coalition Avenir Québec.

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Mr. Lutfy insisted his initiative is non-partisan and that he’s not telling anyone who to vote for. He said timing of his appeal speaks more to the urgency of the matter and the fact that people are “paying attention” to issues right now. He cited research showing Quebec ranks in the bottom 10 per cent of Canadian provinces and U.S. states on key prosperity performance indicators.

Quebec can do much better and business leaders are ready to take up the challenge if political leaders create the conditions and “clear the path,” he said. He called on the next provincial government to set specific targets on gross domestic product, adding that 3-per-cent real GDP growth a year over the next several years and an economy worth $1-trillion by 2033 were achievable goals.

In a report on the state of Quebec’s finances released in August ahead of the election campaign, the provincial finance department projected that real GDP growth would be 0.7 per cent this year and 1.4 per cent next year.

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“You look at the state of our infrastructure, roads, bridges, hospitals, the homelessness in our midst. It’s mind-blowing,” Mr. Lutfy said. “The problems are deepening and we need more money, there’s no question … We’re very good at talking about distributing wealth in Quebec but where will it come from? At some point, we need to talk about wealth creation, too.”

Quebec is a global power in aluminum and aerospace with renewable energy resources and several multinationals that are the envy of the world. But its economy faces several structural pressure points, including an aging population. Since U.S. President Donald Trump was elected, the province has also been the biggest Canadian casualty of his protectionist trade agenda.

Speaking to reporters after Mr. Lutfy’s speech via video feed from Asia, Mr. Bouchard said Quebec remains overburdened by regulations, some of which were put in place decades ago and have never been reviewed, and that those need to be addressed. He said the Quebec government also needs to break out of its impulse to provide subsidies to companies, which often benefits foreign-based corporations to the detriment of local entrepreneurs.

The Couche-Tard chairman recently called for the government to give workers more time to learn French to facilitate their integration. More generally, he said government needs to concentrate its efforts on fundamental missions such as health and education, suggesting Quebec has a bloated civil service that is stretching needlessly beyond its core competencies.

Corporations and investors will put their money elsewhere if this doesn’t change and to some degree, that’s already happening, Mr. Lutfy and Mr. Bouchard said.

Mr. Lutfy said Groupe Dynamite does business in about 50 provinces and states in addition to Britain and that Quebec is “the most onerous jurisdiction to do business in.” He called it “uninvestable, or at least, much less attractive than other markets around the world.”

Mr. Bouchard said Couche-Tard continues to push its expansion and now operates more than 17,000 stores internationally. But he said the company is underinvested in Canada compared with the revenue the country represents, notably because of a complex and costly regulatory regime.

“As business leaders, if we don’t speak up about this, if we don’t intervene, we’ll just continue to complain amongst ourselves,” Mr. Bouchard said, adding that he’s taking a risk in going public with his thoughts. “The situation has become intolerable. We need to do something about it.”