#1 Reason to consider Canada There are tremendous opportunities in - - PowerPoint PPT Presentation

Presentation 2013

#1 Reason to consider Canada

There are tremendous opportunities in the Canadian construction industry, which according to Business Monitor International, is… …the most attractive construction industry in the developed world Canada is posting growth rates in excess of many emerging markets, whilst boasting one of the most attractive business environments globally

Agenda

Short introduction to Canada Overview of the Canadian Construction Industry Opportunities in the Construction industry Challenges and Barriers How to Get Started in Canada

Key words for Canadian politics: Stability, International engagement

Conservative majority government Robust and growing economy Strong relations between DK and Canada

• Artic issues
• International security

Goal of “maximum liberalization” between EU and Canada

Canada is one of the largest and fastest growing countries

2nd largest country 35 mill. Inhabitants

• 28% British, 23% French, 3,5 % Native

& 47 % Other

• 250.000 immigrants every year (total

yearly growth ~350.000) 10 provinces and 3 territories Capital: Ottawa Largest City: Toronto

“Limited” impact by world turmoil Strong growth shown in 1st and 2nd quarter 2013 Growth for 2012 at 2,5% Very low risk of “European” public cut backs Construction, Mining, Oil and Gas are major value drivers

Canada Denmark GDP 1,334,143$million (14) 201,702$million (51) GDP pr. Capita 39,171$ (13) 36,443$ (17) 2011 GDP growth 2,6% 1,1% 2012 GDP growth 2,5% 0,7%

Canadian economy is doing well

13 14 15 16 17 18 19 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 5 6 7 8 9 SA, Millions

Labour market: Canada

Source: Statistics Canada, RBC Economics Research

Unemployment Rate (RHS)

%

Employment (LHS)

Forecast

Canada’s labour market is in good health

The housing market is also healthy – maybe to healthy ?

Forbes ranks Canada as #5 country in which to do business

2011 Rank Country 1 Denmark 1 New Zealand 1 Singapore 4 Finland 4 Sweden 6 Canada 7 Netherlands 8 Switzerland 8 Australia 10 Norway 2011 Rank Country 15 Germany 21 Chile 22 United States 25 France 67 Italy 69 Brazil 78 China 87 India 98 Mexico 154 Russia

Corruption is not an issue

• 40
• 30
• 20
• 10

10 20 30 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Year-over-year % change

Import growth: Canada

Forecast

Source: Statistics Canada, RBC Economics Research

Canada is an open economy embracing imports

Canadian export to Denmark Aircrafts Fish Machines Plant- and fruit oils Danish export to Canada in Machines Windmills Medical products Agricultural products

1 2 3 4 5 6 7 8 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Import Export

Billion DKK Annual export growth of 8,0% Annual import growth of -1,0%

Danish export to Canada is healthy

Current main challenges

Canada–EU is significantly under-traded when compared to other bilateral trade relationships Most tariffs on traded goods are low Main exception is tariffs on processed food:

• EU exporters faces above 30% tariffs when

exporting to Canada

• Canadian exporters faces above 17% tariffs when

exporting to EU Other areas with high tariffs or quotas are:

• EU tariffs of 23% on a number of fish and seafood

products

• Canadian tariffs on footwear, textiles and apparel
• f up to 18-20%
• Canadian quotas on dairy products with out-of-

quote-tariff rates of 250-350%

• Canadian tariff quotas on poultry, eggs, beef,

wheat, barley and margarine products (avg. 150%)

Latest Canadian free trade offer

Trade goods: 98,8% of all tariff lines liberalized with 7 years (97,9% at time of agreement)

• 100% of fish and industry products
• 93% of processed food and agricultural products

(Dairy, poultry and eggs still to be non-liberalized) Services: TBD

Latest EU free trade offer

99,2% of all tariff lines liberalized with 7 years (96,2% at time of agreement)

• 100% of fish and industry products
• 99,4% on processed food
• 95,5% of agricultural products

Services: TBD

EU-Canada trade agreement in the making

Agenda

Short introduction to Canada Overview of the Canadian Construction Industry Opportunities in the Construction industry Challenges and Barriers How to Get Started in Canada

The Canadian building industry. The outperformer

• f the developed market

Canada is the place to be for the construction industry

# of high-rise towers under construction.

New York City (84) + Chicago (19) + Boston (15) + Los Angeles (6) + San Francisco (5) 129 Toronto 129 (296 planned)

More action in Toronto than in Asia?

# of highrise towers

Breakdown of the Canadian construction activities

49 new projects to the list of Canada’s biggest infrastructure projects added in 2013

… That’s double the value of 2012’s 29 new additions ($60 billion versus $30

billion) - twice the renewed investment in Canada’s construction industry …excluding the massive mining, oil, and gas development projects and the many commercial buildings

• $140 billion –

is the 2013 value

• f top 100 most

expensive infrastructure projects

Resulting in infrastructure projects across all sectors

Canadian construction industry is central to the Canadian economy

• More than 10% of GDP and an annual turnover of more than $ 110 bill,

makes construction one of Canada’s most influential industries

• More than 260,000 active

construction companies, totaling more than 1.3 million employees. The most attractive construction industry in the developed world

Construction and buildings are becoming greener

• Green regulations and policies are

increasingly being put in place

• The number of LEED-certified buildings is

increasing

• Surge of activity for retrofitting and updating

existing buildings

• The main environmental pressures are

concerned with air quality, GHG emissions, water quality, urban ecology and solid waste.

Healthy conditions supporting sustained growth for the construction industry

• Infrastructure projects across Canada led the way as part of government

response to the financial crisis of 2008

• In addition to major transportation and social infrastructure projects,

massive energy projects valued at more than $43 billion, and record investments of nearly $40 billion in oilsands over the past two years, $140 billion will be invested in new mining projects in Canada from 2012 to 2017

• Complementing these projects is a multi-billion dollar expansion and

redevelopment of office and retail space

Growth and increased profitability expected at least the next 5 years

Construction in Canada, and particularly in the Toronto area, has seen an impressive continuous growth of 8%, despite global financial setbacks It is forecast that the construction industry will see a rise of 100,000 workers by 2020 to keep up with increased demand

Non-contractor market for building products is also growing

• The market building materials and do-it-yourself products exclusively for

smaller projects exceeds 8 billion dollars and is expected to increase further in coming years.

• The 5 most central building centers cover over 60% of the market for DIY

and small contractors.

Confidence is reflected in increasing capital expenditures

Capital expenditures for construction is increasing in every province. During 2012 the CAPEX of Alberta exceeded Ontario’s by almost 1 $B mainly due to increases in mining, oil and gas extraction, utilities, and housing.

Challenges

Rising energy costs Labour supply Increasing competition Slimmer margins in some local markets Stronger green building codes Delivery times material Accessibility to equipment

Agenda

Short introduction to Canada Overview of the Canadian Construction Industry Opportunities in the Construction industry Challenges and Barriers How to Get Started in Canada

Growth and challenges create opportunities for danish companies

• High demand for solutions that are able to improve energy effeciency for

both construction phase and finished buildings

• Demand for strengtened knowledge base
• High demand for

building materials, equipment and machinery

• High demand for

solutions to reduce risk and improve project planning

Top 50 general contractors

Building Canada Plan

The plan (2007-2014)

Provides $33B in stable, flexible and predictable funding Focus on building a stronger, safer and better Canada through modern world-class public

• infrastructure. Cleaner air and water, safer

roads, shorter commutes and better communities

The New Building Canada Plan:

Economic Action Plan 2013 provides $53B

• ver the next 10 years

Will encourage greater involvement of the private sector in the provision of public infrastructure Economic Action Plan 2013 delivers a new Building Canada plan to build roads, bridges, subways, commuter rail and other public infrastructure in cooperation with provinces, territories and municipalities.

www.infrastructure.gc.ca/prog/bcp-pcc-eng.html www.infrastructure.gc.ca/plan/plan-eng.html

Large number of retrofit and new projects are underway in all provinces

’

• Transportation and social infrastructure projects; rail transit, subway

extensions, station renovations, healthcare and university spaces

• Commercial/Retail construction and redevelopment; 16 new office towers

and multiple malls being redeveloped

• $800M invested in Pan American Games Athletes

Village for the games 2015

• Healthcare projects include; $2B New Oakville

Hospital, $1.75B Humber River Regional Hospital and $759M Niagara Healthcare System

• Energy and mining projects abound $7B in

wind/solar power generation

Large number of retrofit and new projects are underway in all provinces

’

• Capital spending is supported by public and private sectors with

transportation, social infrastructure and commercial/retail projects

• Transportation and social infrastructure projects include $1.8B North East

Anthony Henday Drive, $1.8B Edmonton Airport expansion and $1.3B Calgary Airport Concourse

• The major commercial/retail projects are: $2.25B

Stonegate Office Retail & Industrial Development and $500M Airport Business Park Calgary

• Oil sands investments will continue to sustain the sector
• Housing starts will continue to increase due to jobs

within the oil sands and net migration

Large number of retrofit and new projects are underway in all provinces

’

• Investments in healthcare and massive amounts going into infrastructure,

transportation, mining and energy projects

• Positive long-term prospect is the aerospace

sector due to Bombardier Aeronautics being awarded two major contracts in 2012. One is valued at $3.1B while the other is $7.3B

Large number of retrofit and new projects are underway in all provinces

’

• Maritimes, Newfoundland and Labrador had an inventory 357 projects in

2012 valued at $100B, which is an increase of 39% compared to last year

• Multi-billion dollar investments are being made in

shipbuilding, mining and energy with Halifax experiencing a commercial construction boom

• 2012 spending in this region also set a record at

$12.8B. Leading the investments is a 30-year, $25B naval vessel-building contract

Large number of retrofit and new projects are underway in all provinces

’

• Sustaining high construction levels due to private investment in mining,

energy and commercial/retail

• Personal consumption and residential investments are expected to be

boosted by return to the former tax system as well as positive net migration and job growth

• Oil and gas, and mining sectors are strong with $4.7B

Kitimat Liquid Natural Gas Terminal & Pipeline and $3.3B Rio Tinto Alcan Smelter Expansion

• Large single investment is federal government’s

8-year, $8B contract for seven non-combat ships

Large number of retrofit and new projects are underway in all provinces

’

• Expected to lead Canada’s growth in 2013 with strong investments in

resources and energy development, and high levels of immigration expected to sustain increased housing starts

• Major drivers are oil and gas sector and the $12B investment in potash

mining

• Most notable mining projects are: $4.5B new

Jansen mine, $3.25B Legacy potash mine and $2.8B Rocanville expansion

Agenda

Short introduction to Canada Overview of the Canadian Construction Industry Opportunities in the Construction industry Challenges and Barriers How to Get Started in Canada

Takes time to penetrate the market

• The construction industry is very conservative – which is good when you are

in!

• Competition is strong – but capital intensity is low
• Different provinces have different areas of opportunity and different

regulations – takes time to navigate

• Large building chains have extensive sourcing strategies

Agenda

Short introduction to Canada Overview of the Canadian Construction Industry Opportunities in the Construction industry Challenges and Barriers How to Get Started in Canada

Consider events to participate in - some examples…

Market exploration Market strategy First wave sales meetings Meetings set-up Exhibitions Incorporation & establishment Incubation Partner identification Customer identification and

• utreach

Joint sales efforts Fact-finding and network mission

Discuss with TC Canada

The Trade Councils mandate is to promote danish export

The Trade Council in Canada is part of the Danish Ministry of Foreign Affairs. On a contractual basis, we assist and work as consultants and advisors for Danish companies exploring business opportunities in the Canadian market In 2012 TC Canada was in top 3 in the Ministry of Foreign Affairs measured on value creation for our clients and customer satisfaction More than 50 projects were carried out

Construction cluster approach ?

DK Suppliers A B C D E Canadian targets

Towers O&M Services Mining cluster

Environment and Consultancy Materials Energy Architecture Equipment Planning tools

Construction cluster

General contractors Developers Distributors / retail / rental Architects/ engineers

Construction industry focus rest with the Senior Advisor for Construction, Energy and environment and the head of mission

Krista Damgaard Friis. Senior Trade Advisor, Construction, Energy and Environment Krista has been responsible for the construction, energy and environment sector since 2008. Krista has been a valuable partner for a broad range of small and large Danish companies and she has successfully lead a number export promotion projects, including joint initiatives with the Swedish and Norwegian Trade Council Krista has lived in Canada since 2006, and prior to working for the Trade Council, Krista acted as the bid manager for a Toronto-based senior level management consultancy, focusing on business development and tender processes. Krista holds a master in Marketing and Communications Management, as well as a minor in sustainable business development, and a Bachelor in Business Administration Morten Siem Lynge. Head of Mission at the Royal Danish Consulate General in Toronto. Morten took up his current position in September 2011. He came from a similar position in Dhaka, where he was heading the Danish Trade Council as well as the Danida Private Sector program, which assisted Danish companies in setting up production in Bangladesh. Prior to working for the Ministry of Foreign Affair, Morten worked 2½ years with the Boston Consulting Group and 4½ years at the Danish Ministry of Finance. At the Boston Consulting Group Morten focused on corporate strategy development, cost efficiency strategies and strategy implementation. Morten holds a Master in Political Science and a Diploma in Business Administration (Finance). Both degrees are from University of Aarhus, Denmark.

Consider getting financial support

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