Thursday, November 4, 2010

Potash: BHP says Canada is a "Branch Office" Country

A few miles down the road from Montreal, in the idyllic ski resort town of Bromont, there is a factory built to employ 800 people, substantially with $120 million (in 1988 dollars) of federal and provincial subsidies, that stands as a monument to the worthlessness of multinational corporate promises and commitments.

The factory was built by Hyundai to build cars for the Canadian market and, after generous subsidies pocketed, promptly shut down by the Korean automaker when sales didn't live up to their expectations.

The fact is, that between the time the Hyundai plant was conceived and the time it was closed, the cars had acquired a well-deserved reputation for poor quality and being poorly designed for the Canadian climate. Now, 15 years after the plant closing, Hyundai is selling 95,000 cars in Canada. Obviously, Hyundai's commitment to sell cars in Canada could never be questioned - however, its commitment to corporate citizenship in Canada obviously varies according to which way the wind is blowing.

The minute the ride got a bit rough, Hyundai bailed faster than a bandit, even though they were entirely responsible for their design problems.

Now on the subject of potash, we are talking about a strategic resource of critical importance for the future of feeding the planet. Not much trumps food. And, when it comes to growing food, here is the list of what trumps fertilizer:

Water. (Canada does ok on this count)
Land. (the land grab is on, but Canada has quite a bit)
Seed. (already largely under the control of a small few corporations)

So Industry Minister Stephen Harper - er - Tony Clement did the right thing yesterday and rejected the BHP bid for Potash. Unfortunately, he also did the gutless thing and left the door open for BHP to "present something" that would change his mind in the next 30 days.

I guess they don't get it. No "promise" BHP or any other multinational corporation could make can be trusted, nor will it make Canada anything but a branch office of Potash.

Even the Chairman of BHP agrees:

When reviewing BHP's application, Ottawa might also want to consider comments made in 2008 by BHP's chairman at the time, Don Argus. Calling on his fellow Australians to continue investing in domestic mining assets, he cautioned that Australia's resource sector was at risk of becoming globally irrelevant - just like the mining sector of another former British colony.
"If we fail to remain competitive," the BHP chairman warned, "Australia will incur a substantial opportunity cost and in the worst-case scenario, our resources will fall into overseas hands and we will also become a branch office - just like Canada."

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