Small Business the Key to Future Growth: Poloz

New Governor of the Bank of Canada (the Bank), Stephen S. Poloz, told a Vancouver board of Trade audience last week that the key to economic growth in Canada lies in the creation of new businesses which in turn, create new jobs, and the new income required to propel our economy forward in the near future. 

Canada in fact is well positioned to incubate those new businesses according to Ernst & Young’s G20 Entrepreneurship Barometer, released at the end of August. Some reports, it says, have suggested that up to 150,000 new businesses may sprout in the next decade. 

However they will face several obstacles, not the least of which is funding. According to the report, private equity and venture capital are improving but bank financing in Canada is still a challenge. The report found that nearly three in four Canadian entrepreneur’s struggle to find funding.

Funding is most important to long term survival rates and so is key to the issue of sustainable growth in business. According to Industry Canada, survival rates for business declines over time. About 85% survive one year; 70% survive for two and 51% for five years.

For its part, the Bank of Canada will stand firm in its commitment to keeping inflation stable, predictable and on target, according to Mr. Poloz, who noted that Canada was the first of the G-7 countries to recover from recessionary decline in output and was able to add 600,000 jobs above all those regained since the crisis.

Yet unemployment remains an issue in our country; currently still over 7 per cent. That’s where small business comes in to the rescue—that is, if our stable banking system will back them with the money required to start up and grow.