Quebec remains the undisputed leader in corporate bankruptcies in Canada. In fact, as many as 60% of bankruptcies in the country last year were caused by Quebec-based companies.
This data comes from the most recent monthly statistics report from the Office of the Superintendent of Bankruptcy (OSB), released last August. Compared to the provinces, Quebec stands out both for its high rate of bankruptcies and its disproportion in relation to its demographic weight in Canada.
For example, the BSF revealed that a total of 3,097 companies filed for bankruptcy in Canada between July 2022 and 2023. However, during the same one-year period, 1,879 corporate bankruptcies were recorded in Quebec, representing 61% of all bankruptcies in the country.
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This figure is all the more surprising given that Quebec, with its 8.8 million inhabitants, only accounts for 23% of Canada’s population. In comparison, neighboring Ontario, with as many as 15.6 million residents, or 40% of Canada’s population, recorded just 816 bankruptcies, less than half of Quebec’s.
The Golden Palm in Quebec
The question was raised last week in the National Assembly by MP Frédéric Beauchemin, a liberal critic of finance and economics. The former CEO and head of capital markets at Scotiabank bristled at Minister Pierre Fitzgibbon, accusing him of appearing to be proud that Quebec was awarded “the Palme d’Or for bankruptcies in Canada.”
The reasons that could explain this situation are not clear. Many economists we asked for explanations admitted that they had a poor understanding of the phenomenon. Possibilities mentioned include a corporate structure composition that differs from that of other provinces and a less favorable business environment for companies.
“Quebecers have problems,” MP Beauchemin said in an interview with Le Journal. The numbers show they are being forced to make difficult decisions during this time of high inflation. Several companies fail. And while the CAQ spends a fortune welcoming foreign companies, we let our SMEs die with almost complete indifference. This is all sad. »
-With the contribution of David Descôteaux
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