MONTREAL - Saying Canada's economic well-being depends on companies having the capital they need to create growth, Prime Minister Stephen Harper laid out the details Monday of a plan to bolster venture capital investment in the country.
The government's Venture Capital Action Plan, which was announced in the last federal budget, is making $400 million available to help increase private-sector investments in the next seven to 10 years.
Ottawa is aiming to deploy $400 million to help increase private-sector investments in the next seven to 10 years.
"Canadian venture capital markets have been dealing with mixed results and growing challenges over the past decade, especially since the global credit crunch of 2008-2009," Harper told a news conference in Montreal attended by a large contingent from the business community.
"This unfortunate situation has meant that Canadian firms with good ideas and high growth potential have often been starved for needed funds."
The Venture Capital Action Plan will make available $250 million to establish new funds led by the private sector in partnership with institutional and corporate strategic investors as well as interested provinces.
Up to $100 million will be made available to recapitalize existing large private-sector funds while there will also be a $50-million investment in three to five existing high- performing Canadian venture capital funds.
"Our government firmly believes strong action is required to bolster the available risk capital in Canada," Harper said. "It is vital for Canada's economic future and indeed for the long-term prosperity of all Canadians."
In Ottawa, NDP finance critic Peggy Nash slammed the plan as woefully insufficient.
"The prime minister's venture capital plan amounts to just peanuts and won't get the job done," Nash said.
"Canada’s venture capital market has been underperforming for over a decade and this funding will likely have little meaningful impact. New Democrats are calling on the government to step up and take a lead on Canada's economy rather than wait for others to do it."
Finance Minister Jim Flaherty, who attended the announcement along with Maxime Bernier, the minister of state for small business, said the country is relying on the creativity and ingenuity of young Canadians.
"The primary focus here is on young entrepreneurs and the fact that we're losing young entrepreneurs and their businesses to American enterprises, larger enterprises," he said of the plan.
Flaherty said the government is aware of thousands of young entrepreneurs across the country who need the kind of support proposed in not only the federal plan but also strategies devised by the provinces.
Harper made the announcement on the set of the French-language version of CBC-TV's "Dragon's Den," which focuses on entrepreneurs pitching their ideas for possible investment.
"It's a very popular show," Harper quipped. "One that my own family watches quite often."