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Trudeau going soft on SNC-Lavalin’s corruption could cost Canada a lot

9 18 1500

Prime Minister Justin Trudeau has said time and again that SNC-Lavalin jobs should be considered in deciding whether the company’s charges for bribery and fraud should be swapped for a deferred prosecution agreement, contrary to the existing legislation. At the same time, he says he strongly supports the rule of law, including in the context of Canada arresting the CFO of Chinese telecom giant Huawei, after a U.S. request for her extradition, although China’s retaliatory trade measures, starting with its decision last week to blacklist some Canadian canola, put other Canadian jobs at risk.

Both scandals highlight an important question: Does the rule of law affect a country’s economic growth and ability to create jobs? Most Canadians would probably say “yes,” in the belief that better governance promotes a stronger economy. By that logic, even if SNC-Lavalin were put on trial and convicted and some jobs were lost, it would be worth it. Our reputation as a country with a strong rule of law is itself far more important because it preserves jobs in all industries.

But having recently read up on the question of whether rule of law affects economic growth, I can report that there is no overwhelmingly consensus about the answer. China has had strong growth over the past three decades, but it’s only the 87th least-corrupt country out of 180 countries ranked by the Transparency International Index, with a score of just 39 of 100. By contrast, Canada is........

© Financial Post