The Canadian Government has begun talks with industry on how to restructure the Technology Partnerships Canada (TPC) programme to make it compliant with World Trade Organisation (WTO) regulations on export subsidies.
Industry minister John Manley threw down the gauntlet to Brazil at Aerospace North America by stressing that Canada is committed to making TPC support for research and development "fully consistent" with WTO rules.
Earlier this month, the WTO upheld rulings that Brazil's Proex subsidies for Embraer regional aircraft exports and Canada's TPC support for Bombardier regional aircraft development must be withdrawn within 90 days (Flight International, 11-17 August). "We will play by the rules, and expect Brazil to do the same," says Manley.
"TPC will remain a vital strategic investment tool for Canada's aerospace industry," he says. This will require changes to the programme. Ken Laver, chairman of the Aerospace Industries Association of Canada's Technology Council, believes support will be refocused from product development to technology research.
Manley says the government will insist on repayment of TPC loans. Laver says this could pose problems for smaller companies.
Whether TPC loans need to be repaid, and whether the money could be used for capital investments instead of technology development, will be discussed with the government this month, he says.
Source: Flight International