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October 9, 1997
(Executive Council)

Study names St. John's as lowest cost location for business

(Moncton) Brian Tobin, Premier of Newfoundland and Labrador, said today that he was extremely pleased that St. John's has been named the lowest-cost location in a study by KPMG that compared the costs of doing business in Canada, the United States and Europe. The study was sponsored by the federal Department of Foreign Affairs and International Trade, the Royal Bank of Canada and Ontario Hydro. The results of the study were announced in Ottawa earlier today by Sergio Marchi, Minister of Foreign Affairs and International Trade.

The study examined eight location-sensitive cost factors in eight industry sectors in 42 North American and European cities. St. John's ranked first with the lowest costs in each of the eight industry sectors examined. Canada led the top five lowest cost countries, ahead of Sweden, the United Kingdom, the United States and Italy.

Premier Tobin said that the KPMG study, known in business circles as one of the best and one of the fairest, confirms what he has been saying to the business community. He said, "For any company interested in low costs that can provide a decided advantage in today's global marketplace, they should consider St. John's. We have some of the lowest corporate tax rates in the world for manufacturers and small business, a stable and productive workforce, modern transportation and communications networks, and we are strategically located between North America and Europe. We will be working very hard to promote the results of this study, which has been sponsored by some very credible organizations."

Judy Foote, the province's minister of Industry, Trade and Technolgy, said that St. John's being named the lowest-cost location out of 42 cities in North America and Europe can be attributed to a number of factors. She said, "In the last couple of years, we have worked hard to enable businesses to operate with the least amount of burden from government. We have carried out a regulatory review process, made changes to our tax structure to make it more competitive, reformed our environmental assessment process and we have established a creative incentive program known as the EDGE (Economic Diversification and Growth Enterprises), all with the aim of creating the right climate for business."

The study is an update and expansion of previous KPMG studies, carried out annually since 1994. The Atlantic Canada Opportunities Agency also commissioned KPMG to conduct a comparison of the four cities in Atlantic Canada as a region, with similar regions in the United States and Europe. The four Atlantic Canadian cities examined, St. John's, Halifax, Charlottetown, and Moncton, have the lowest overall costs, ranking in first through fourth places, respectively. These results also showed that St. John's has the lowest costs in every industry, while the other three Atlantic Canadian cities surveyed consistently rank in the top seven.

Contact: Heidi Bonnell, Office of the Premier (709) 685-3674.