Canada could attract far more international investment if it had a single national securities regulator that could respond nimbly to crises, Canada's representative to the International Monetary Fund said Thursday.
Tom Hockin told a Toronto audience that other global representatives on the IMF's 24-member board of directors have chided him over Canada's inability so far to create a national securities commission.
"My colleagues at the IMF say, 'Why can't you get this done?' and I don't really have a good answer except provincial parochial attitudes," he told an Economic Club of Canada luncheon.
In an interview later, Mr. Hockin said provinces opposing a national securities regulator are "oblivious" to international concerns, but that securities regulation is "a black tooth in the otherwise nice smile Canada has" in the eyes of global investors.
He said a national commission would build confidence internationally in Canada's capital markets and would draw more investors to the country. It would also assuage international regulators who are concerned about Canada's ability to manage broad systemic risks when market oversight is splintered.
The IMF, Mr. Hockin said, is not confident Canada can move quickly to deal with emerging problems when policy must be co-ordinated through 13 provincial and territorial securities commissions. "They're concerned about nimbleness if a crisis occurs."
He said Canada is not nimble when capital markets crises emerge, citing the slow response by securities commissions to the meltdown of the non-bank asset-backed commercial paper market in 2007.
Mr. Hockin, a former Mulroney-era cabinet minister, was named Canada's representative to the IMF in December, 2009, and now lives in Washington, D.C. Before his appointment, he led a committee whose January, 2009, report became the basis for the federal government's current plan to create a national securities regulator.
His comments Thursday come less than 10 days after Bryan Davies, vice-chairman of the transition office created to develop the structure of a new securities regulator, delivered a public address that insisted the plan is alive and well, and dismissed concerns that it is withering as more provinces speak out in opposition to the plan.
Alberta, Manitoba and Quebec have said they will not join the national regulator, and a number of other provinces have been non-committal.
In December, Saskatchewan Finance Minister Ken Krawetz said the province would not join the national commission, but Premier Brad Wall recently said his position is "less hardened" than other provinces. Mr. Wall said he does not necessarily oppose a national regulator "with provincial components" if it protects and supports venture capital companies in the natural resource sector while also protecting investors.
"If we can achieve those two things, we ought to try," he said.