Article by Jeff Lagerquist,
Cannabis firms are being barred from part of Ottawa’s plan to shore up the economy as the COVID-19 virus continues to spread, forcing more businesses to reduce activity or close down by the day.
Export Development Canada (EDC) and the Business Development Bank of Canada (BDC) announced a joint strategy last Friday to inject additional liquidity for businesses, pledging to increase loans typically issued on commercial terms by $10 billion. The crown corporations have yet to detail exactly how the new Business Credit Availability program will work.
Dan Sutton, chief executive officer of B.C.-based cannabis producer Tantalus Labs, said a BDC senior account manager told him, “We do not do business with cannabis firms at this time.”
George Smitherman, president and CEO of the Cannabis Council of Canada, told Yahoo Finance Canada that response “fits with what the industry has been told to date.”
“We are forced to remind people that more than 300 Health Canada licences are all new businesses in a fledgling, complicated sector, and that like other Canadian businesses, we badly need support from governments due to the added tumult onset by COVID-19,” he wrote in an email on Tuesday.
“We will be seeking to mobilize the cannabis sector to speak up about this unfair situation by calling their MPs. It’s a good chance to remind policy makers of the $8 billion contribution we have made to GDP so far, and the thousands of employees our member companies employ.”
An EDC spokesperson told Yahoo Finance Canada that she is unclear on which types of businesses will have access to the program, and promised to look into the issue. BDC has yet to respond to a request for comment.