As reported in the attached article, Canada is out $41 million in assets after a corrupt South African family defaulted on their loan. By attaching itself, via government deals, the Canadian government found themselves in a position to push the aviation products offered by Bombardier. This led to a questionable loan provided by crown operated export-import bank Export Development Canada (EDC).
Government involvement in this segment of aviation has been very active in recent history calling attention to how tax dollars serve to fund the industrial, government and financial hegemony. Related to this story is how the Canadian government provided almost $1 billion in funding to keep Bombardier operating and to preserve the highly anticipated C-Series aircraft line. No endless supply of debate on the bail out including the bonuses Bombardier executives received after bringing their company to the brink of bankruptcy. Then Boeing nearly scuttled a major C-Series contract to Delta when the US government attached 300% tariffs on transactions. The tariffs were only temporary when the US International Trade Commission overturned the tariff decisions. However, before that transpired Bombardier had already sold the C-Series program to Airbus so the planes could be made at the US Airbus plant and avoid the import label. Thus, the precious economic development opportunities for Canada were lost to US manufacturing.
In tabulating how the Canadian taxpayers benefited from these transactions its hard to see any significant return. Bailing out Bombardier was provided for the potential to maximize manufacturing in Canada but, with a portion moving to the US, returns would be reduced. Airbus has not invested anything into Bombardier and only assumed liabilities that the Canadian tax payer funded. Now with the Delta deal proceeding, after the tariffs were removed, the risks are considerable less. At the blink of an eye Canadians moved from the main benefactors of the C-Series line to watching from the Airbus sidelines. Could the C-series have survived without the Airbus partnership? Its only hypothetical now however, its seems Canadians investment had been marginalized as a result. And the $41 million loan to the Guptas familiy of South Africa still counts towards Bombardier and EDC executive bonuses. They won’t have to pay back those funds but Canadians will still by paying through taxes and ever increasing financial deficits. We can only hope the authorities find the missing Global 6000 plane the Guptas bought so we can minimize our losses or Airbus manages to increase share values so Canada can sell out and pay off some debt.