What do Inco Inc., Placer Dome, Noranda Inc. and Alcan all have in common?  If you said that they were Canadian resource companies that were bought by foreign investors, you would only be partially right. As Andrea Mandel Campbell describes in her book Why Mexicans Don’t Drink Molson, every one of these great Canadian icons got their start with foreign investors. Inco, Placer and Noranda were all started by American syndicates. Alcan was a spinoff from New York based Alcoa, and Dome was founded by New Zealand and Australian entrepreneurs.

Canadians need to take a valium on the issue of foreign investment. Foreign investors have been integral to the growth of this country since confederation. Even the CPR, that historic transportation ribbon that made the Canadian nation possible was financed by foreign investors. More recently Nortel started out as a manufacturing subsidiary of AT&T. In fact, most major Canadian  energy producers – Nexen, Talisman and Suncor are also spin-offs of foreign multinationals.

Which brings me to Potash again. The Potash Corporation of Saskatchewan (PCS) is already owned in the majority by foreign investors. But instead of re-investing its profit in new mines it has been growing its bottom line through the assistance of a cartel – Canpotex –  that manipulates the price of the commodity. Meanwhile, it is another foreign investor, BHP Billiton, that is developing the only new potash mine in North America. That mine is in Saskatchewan. That new mine will create new jobs and new markets as well as hold out the hope that billions of people around the world will have access to affordable food because it’s the major component in fertilizer.

To help BHP Billiton, the company wants to acquire PCS so that it brings experienced potash mining management into its fold and eventually moves to market-based pricing.

As a proud member of the advisory team for BHP Billiton, I am unable to discuss the nature of BHP’s undertakings beyond what has already been made public by the company.  What we know is that BHP is prepared to: move the worldwide potash headquarters to Saskatchewan; protect existing jobs in Saskatchewan and New Brunswick; fix any perceived tax issues that would have impacted Saskatchewan’s fiscal framework; and submit to strong enforcement measures. This is what has been made public. There is no precedent  for failing a net benefit calculation with  undertakings that are so extensive.   It is a pity the flames of protectionism have been stoked, when it is so clear that this foreign investment is  critical to the development of one of Canada’s major resources.