doing business e - legislative assembly of ontario · 2007-01-08 · accounting and marketing...

A Hub for Global

Business

CanadaOntario

Note: Every effort has been made to ensure the accuracy of the information in this publication at the time of printing. However, the programs referred to and the data cited are subject to change.

All figures are in US dollars unless otherwise noted. The exchange rates used are based on Bank of Canada annual averages.2002: Cdn$1.00 = US$0.642003: Cdn$1.00 = US$0.712004: Cdn$1.00 = US$0.77

1 A H U B f o r B u s i n e s s

With the rise of the

global business model,

Ontario, Canada,

emerged as an efficient,

North American hub

for international business.

We offer:

• a growing economy

• strong trade partnerships with North America, Europe and Asia

• competitive business costs

• a highly skilled and diverse workforce

• an innovative environment

Come grow your business in Ontario.

The rise of the global business model revolutionized international business.

Today, large and small companies locate their manufacturing, product assembly,

R&D and contact centres wherever they find the best combination of talent, cost-efficiencies

and market access.

Ontario, Canada, has emerged as an efficient, North American hub for global

business. During the past ten years, foreign direct investment in key sectors—automotive,

ICT, chemicals—has soared and exports have grown by more than 50% as multinationals

recognized the tremendous advantages of doing business here.

What’s behind Ontario’s success? We offer:

• direct access to the $13.8+ trillion North American market plus strong trade partnerships

with Europe and Asia

• a highly educated multicultural workforce with advanced manufacturing skills and

international business experience

• an innovative environment

• streamlined regulations

• a low-risk investment climate.

Ontario-A Hub for International Business

Come to where theworld does business.

Come to Ontario.

In their forecast of the global business environment through to 2009, the Economist Intelligence Unit (EIU) ranked Canada as one of the best countries in the world to do business, thanks to our openness to foreign trade and capital, high-quality infrastructure and opportunities within the North American marketplace.

fact


Toyota

From the moment the first Corolla came off the assembly line in 1988,

Toyota Motor Manufacturing Canada (TMMC) has been on a roll.

The award-winning Cambridge, Ontario facility employs 4,300 workers

who produce more than 300,000 Corolla, Matrix and Lexus RX330

models a year. In fact, Cambridge is the only plant outside Japan to

build the Lexus, a tremendous vote of confidence in the company’s

Ontario operation. Now, in another vote of confidence in Ontario,

Toyota has chosen Woodstock, a small town in the province’s busy auto

corridor, for the site of its new North American assembly plant. Slated to

be up and running in 2008, the $900 million flexible facility will have

the capacity to build 150,000 units a year and will start by producing

the RAV4 sport utility vehicle. “Ontario is a great place to build cars,”

says TMMC President Ray Tanguay. “We couldn’t have expanded

into Woodstock without access to a skilled labour pool, excellent

transportation system and a very supportive Ontario government.”

Top10Ontario’s

Trade Partners – 2004

Total trade = exports + imports US$ (millions) Percent of TotalUnited States 255,925 79.3China 10,413 3.2Mexico 9,395 2.9Japan 6,356 2.0United Kingdom 5,385 1.7Germany 4,007 1.2South Korea 2,122 0.7France 2,037 0.6Italy 2,001 0.6Taiwan 1,787 0.6Total: Top Ten 299,428 92.8Total: All Countries 322,704 100.00Source: Industry Canada

Connected to Global MarketsIn 2004 total trade (exports plus imports) topped $322.7 billion—double what it was ten

years ago. Our auto industry produces one-sixth of all vehicles built in North America.

Our advanced manufacturing sector is helping to shape the future with its innovative

processes and products. Our information technology and telecommunications companies

are world leaders. Our life science sector—pharmaceuticals, medical devices and

biotech—is a North American hotspot.

And as Canada’s manufacturing, R&D and financial centre, Ontario has been the

destination-of-choice for about 40% of the billions of dollars in international investment

that pours into Canada each year.

Solid connections with major marketsWe’re part of the affluent $13.8+ trillion NAFTA market, which allows Ontario products

to enter the U.S. and Mexico duty-free when 62.5% of their content is manufactured here.

Ontario-based companies can bid on the procurement contracts of the U.S. and Mexican

governments and state-owned corporations.

We also have solid business connections with Europe and Asia. Total trade has

grown to more than $13 billion with leading countries and more than $20 billion with

Asian leaders.

Companies come to Ontario because of the market access; they expand because

of the quality. Toyota, for example, manufactures its luxury Lexus RX 330 here—the only

place in the world outside Japan with a Lexus mandate.

International business is growing rapidly in Ontario.



Messier-Dowty

Paris, France-based Messier-Dowty is the world leader in the design,

development, manufacture and support of landing gear systems and its

Toronto facility plays an important role in the company‘s success.

Charged with designing, testing and manufacturing systems for all

regional and business aircraft within Messier-Dowty worldwide, the

Toronto facility also produces gears for some military aircraft and builds

many of the components that go into the landing gear. Its clients include

some of the biggest names in aerospace including Boeing, Bombardier,

Raytheon and Dassault. The 200,000 square-foot Messier-Dowty

Toronto facility, which underwent an expansion in 1997, employs 530

highly educated and skilled people and features a state-of-the-art final

assembly area where the systems are fully assembled and tested prior

to delivery to the customer. “Our location in Ontario gives us access to

a pool of the kind of highly skilled people we need,” says Tim Whittier,

Director of Marketing for Messier-Dowty Toronto, who points out that

the company is actively involved in co-op programs with a number of

Ontario universities. “Also advantageous is our proximity to the U.S and

a sophisticated transportation system that lets us get our systems and

components to our clients quickly.”


Messier-Dowty

The Windsor-Detroit border crossing is the busiest trade gateway in North America. Every day, 9,000 trucks use it—a quarter of all Canada-U.S. truck traffic—and they carry over $300 million worth of just-in-time deliveries. Canada and the U.S. are expanding the capacity of this crossing with $240 million in infrastructure improvements.

fact

Fast, flexible distribution networksProducts, people and ideas flow smoothly in and out of Ontario. Our transportation and

telecom infrastructures are extensive, sophisticated and integrated with U.S. systems.

Advanced telecommunications networks offer unsurpassed reliability and speed

and seamless international connections. Fifteen road, rail and marine border-crossings

provide access to the U.S. market. With four international airports and a network of

regional airports, business centres like Toronto, Ottawa, Thunder Bay and London are

only a two-to-three hour flight from major U.S. cities like Detroit, Chicago, New York and

Boston. Toronto’s Pearson International Airport is serviced by more than 65 airlines which

provide same-plane service to 43 cities in the U.S. and 42 cities abroad.

Ontario has embraced the global business model. We have the market access,

connections and experience to help your company grow.

Home for multinational operationsSix of the world’s largest automotive companies and eight of the world’s 10 largest chemical

companies are here. So are nearly all the global biotech giants and international leaders in ICT

and aerospace.

Many Ontario operations have global mandates for key products, including

ATI Technologies, DaimlerChrysler, DuPont Canada, GM, Husky Injection Molding Systems, IBM,

Magna International, Messier-Dowty, Nortel Networks, Research in Motion (RIM) and Toyota.

A Centre of International Business Expertise


Doing business around the world requires special expertise.

We have it, and that’s one of the reasons why so many companies build their

international operations in Ontario.

Glaxo SmithKline

Thanks to its success in highly specialized manufacturing, GlaxoSmithKline’s

Canadian operation, headquartered in Mississauga, is expanding.

The 250,000 square-foot manufacturing and development facility, which

already produces more than 75 different medications, is getting a

$23 million (Cdn) expansion to fulfill 22 new global manufacturing

mandates. The U.K.-based company is also investing $1 million (Cdn)

in MaRS, a not-for-profit corporation located in downtown Toronto that

brings together the best-in-class in science, business and academia to

accelerate commercialization of medical discoveries. GSK produces and

ships $2 billion (Cdn) worth of medications a year, 80 per cent of which

is exported, many to more than 70 countries around the world. “Our

Mississauga facility produces a wide range of innovative medicines to

treat children living with HIV in Africa, malaria patients in the developing

world, and allergy sufferers here in Ontario,” says GSK President and

CEO Paul Lucas. “To be successful, we rely on Ontario’s highly skilled

work force to provide the knowledge and ability to take an idea from the

lab to the marketplace.”

Arvato Services

In 2003 Arvato Services, a subsidiary of the German-based international

media service provider Bertelsmann, was looking to add near-shore

capabilities to its existing centres. A leading global provider of integrated

and customized outsourcing services for Fortune 500 companies in the

IT, consumer electronics and travel industries, Arvato had a list of key

criteria. “A lot of due diligence goes into the selection for a new site,”

says Stephen Guhr, Director of Operations for Arvato Services. The

company combined its own research with that of site selectors to choose

Kitchener, Ontario for its first near-shore centre. “The most important

factor in our business is a supply of highly qualified and diverse labour,”

says Guhr. “Kitchener offered skilled workers with a wide range of

language skills, which is essential for servicing our clients.” It also offered

available space, sophisticated telecommunications service, proximity to

the Greater Toronto Area (GTA), and a strategic location from which to

expand its operations. Arvato Services opened its Kitchener location in

May 2003 with 150 customer service professionals which more than

tripled to 475 by September 2004. Says Guhr, “We’re definitely looking

to grow some more.”

Connected to global business systemsWe understand global business. We have cultural and business affinities with the U.S.,

Europe and Asia that smooth the way for international trade, investment and project

partnerships.

In a recent Economist survey of 90 countries, only Finland and Sweden ranked

higher than Canada for honesty and reliability in business.

We observe best-in-class intellectual property and privacy regulations. Our legal,

accounting and marketing firms understand the needs of international business.

We operate on Eastern Time. At most, this means a three-hour time difference

within North America and same-day business access to Europe.

Business–in any language– spoken hereAs one of the most multicultural societies in the world, we’re fluent in more than 100

languages including French, Spanish, German, Japanese, Mandarin, Cantonese,

Korean and Punjabi.

We also make it easy to bring together worldwide research or production teams.

Work visas for key employees and their families can usually be obtained within days.

When it comes to doing business in the global village, we’re right at home.


Canadians rank third in the world when it comes to high-speed Internet access, according to a recent report by the Geneva-based International Telecommunication Union. High-speed connections are seen as a key to future sales and profit growth.

fact

The bottom line for global business success rests on workforce skills and competitive costs—

two areas in which Ontario excels.

Growing knowledge-based industries, whether they’re in advanced manufacturing,

ICT development, biotech or contact centre services, need access to a large pool of educated,

skilled and reliable workers. They find it in Ontario.

Where High Quality Skills and

Competitive Costs Converge

Ontario’s workforce is:

• well-educated A higher percentage of our workers have post-secondary education than in any G7 country.

• skilled A network of 20 universities and 24 colleges trains students in every field from the skilled trades to the

most advanced areas of science, engineering and business.

• dependable Our workers’ on-the-job average is 8 years, in manufacturing it’s 9 years and that translates into lower

training costs.

• ethnically diverse We speak more than 100 languages which means we can work with your customers and suppliers in

their own language, anywhere in the world.


A workforce with advanced skills

Ontario’s cost advantageWhen it comes to core operating costs, Ontario businesses have a distinct advantage.

KPMG’s comprehensive 2006 Competitive Alternatives study of international

business costs reported that Canada’s costs are the most competitive of the G7 countries

(U.S., U.K., France, Germany, Italy, Japan and Canada). In its city-by-city comparison, the

same study showed that Toronto, Ottawa, Sudbury, Sault Ste. Marie and Waterloo offer

cost advantages over 60 cities across North America, Europe and Japan.

Ontario’s combined (provincial and federal) general corporate income tax rate is

almost

4 percentage points below the U.S. average and our payroll taxes are the lowest of the

G7 nations.

And employee health care benefits cost Ontario manufacturers about half as much

as their U.S. counterparts—6.8% versus 13.2% of wages. In Ontario, most services such

as doctor’s fees, tests and hospital stays are paid through the public health system.

Innovation incentivesInnovation costs are low and R&D talent is plentiful in Ontario.

More industrial and university-based R&D is performed in Ontario than anywhere

else in Canada. Leading-edge research is conducted in virtually every area of ICT,

advanced manufacturing and life sciences. We have incubators, research parks and

technology transfer offices throughout the province.

The Ontario government has committed close to $1.4 billion over four years to

support research and commercialization at our universities, colleges, hospitals and

research institutes.

Our R&D tax incentive program is one of the most generous in the world. When

tax credits are factored in, the after-tax cost of $100 in R&D spending can be reduced to

less than $41.

We have the people. We have the know-how. It’s no wonder savvy investors keep

Ontario on their short-list of global locations.

Lake Superior

Lake

Michigan

Lake Huron

Lake Ontario

LakeErie

Buffalo

Ottawa

Toronto

Sudbury

DetroitWindsorChicago


New government programs will expand the number of apprentices in

high-demand areas to 26,000 annually by 2007-2008.

fact Ontario’s Innovation Corridor –

From Windsor to Ottawa and into Northern Ontario, throughout

Ontario’s Innovation Corridor, world-leading companies collaborate with

more than 150 university, college and public research centres to speed

new discoveries and processes from the lab to the marketplace.

When fast-growing San Jose, California based Nuvation decided to

expand its design capabilities by establishing a satellite design centre,

the company looked at a number of possible sites, including India, the

Pacific Rim, Eastern Europe and Canada. A global leader in electronics

design services (EDS) whose clients include HP, DaimlerChrysler, Lucent,

Fujitsu and Agilent, Nuvation needed a location that could provide a

supply of top-tier engineering talent, competitive business costs and low

IP and business risk. “In the end, the decision was easy,” says Chris

Hallahan, Nuvation’s VP Sales & Marketing. “The one place that fit the

bill was Waterloo, Ontario. It delivers superlative design talent, highly

competitive business costs, a similar culture, language and laws and an

entrepreneurial spirit that matches ours.” There’s also Waterloo’s relative

proximity to the company’s headquarters and customers. “Many of our

clients are increasingly averse to the risk and efficiency loss inherent

in offshoring,” says Hallahan. “Waterloo maintains our quality of

engineering and productivity, and at an even greater value to our clients

thanks to a favourable exchange rate.”

Nuvation

The ideal business location is big enough to support growth but small enough to offer

easy access to decision-makers.

In Ontario, we think we’ve got the balance just right.

Where Business Expansion can have a Big Impact

A growing economyAt almost $400 billion, our GDP is larger than that of Switzerland, Belgium, Sweden or

Austria, and big enough to support a broad base of manufacturing and financial and

business services. In many ways, Ontario is a microcosm of bigger markets.

And we are growing. Between 1993 and 2003, Ontario’s economy grew faster than

any of the G7 nations. Real GDP growth averaged 3.7% per year. Looking ahead, our GDP

is forecast to grow 3.2% annually through 2006–2008 while inflation is expected to remain

below 2% per year.

But at the same time, with a population of less than 12.5 million, we are small

enough so that global business leaders and investors can make a big impact.

Nuvation


Our universities and colleges produce more than 29,000 graduates a year in mathematics, engineering and sciences.

fact

Streamlined regulationsDecision-makers listen and respond to what investors need. Regulatory systems have been

streamlined.

Site permitting is much quicker here than in many jurisdictions. Business start-

ups require only two simple steps here, compared to as many as 20 needed in other

industrialized countries.

All the necessary infrastructure is in place—buildings, transportation, telecom.

The result? Faster turnarounds, so that companies can get on with growing their businesses.

Business success and a high quality of LifeWe have an environment designed for global business success and the high quality of life

that goes with it.

We’re a multicultural society that welcomes people from around the world. No matter

where you come from, you’ll find a community in which you will feel at home.

And the choice of after-hours pursuits is endless, from sophisticated urban nightlife to

relaxing at a lakeside cottage.

It’s this combination of business advantages and quality of life that is leading more

commercial investors to choose Ontario for their global business expansion.


Lisi Automotive

When French-based Lisi Automotive—a leader in engineered fasteners

and safety critical components—decided to build a North American

facility, the company had a list of requirements that had to be met.

Lisi was looking for a location that offered skilled labour—some fluent

in French—competitive business costs and proximity to its tier-one

customers in the U.S. and Canada. The ability to grow the business was

an important consideration as well. After investigating four potential

sites, Lisi chose the Greater Toronto Area (GTA). Situated in the heart

of the North American auto industry, the GTA delivered everything the

company was looking for—including the ability to get up and running

quickly. It took just three months from renting a building to the start of

production. “In setting up our operation here in the GTA, we‘ve been

impressed with the culturally diverse talent pool and with how relatively

easy it‘s been to recruit and retain highly motivated and skilled workers,”

says Martin Beley, Chief Operating Officer. Lisi began production in

July 2002. It quickly attracted new customers and is already planning to

double its manufacturing capacity over the next two years.

Let us help you quickly find the data and contacts you need.

Please visit our website, www.2ontario.com or call us at

1-800-819-8701 (North America) or

00-800-46-68-27-46 (U.K. and Europe) for:

• the latest information on our economy and business climate

• comprehensive profiles of Ontario municipalities

• province-wide site searches of available industrial land and buildings

• coordination of site selection and community visits throughout the province

• contacts with federal, provincial and municipal officials, as well as utilities, transportation

firms and business facilitators.

Information and

expert advice for investors


Ontario Investment ServiceBCE PlaceTD Canada Trust Tower, Suite 4040, 161 Bay StreetToronto, Ontario, CANADA M5J 2S1Tel: 416 360-4647 Fax: 416 360-1817

1-800-819-8701 (North America)00-800-46-68-27-46 (U.K. and Europe)e-mail: [email protected]

www.2ontario.com

Printed in Ontario, Canada on recycled paper © Queen’s Printer for Ontario, 2006 316-ENG/03/06

doing business e - legislative assembly of ontario · 2007-01-08 · accounting and marketing...

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